According to foreign media reports, Hyundai Group of Korea is trying to reduce its production costs by investing in the establishment of OEM factories, so as to invest more funds in the development of new technologies, including electrochemical technology.
It is reported that Hyundai Group is considering the joint establishment of an automobile factory by the local government of Kwangju, South Korea. The joint OEM plant will produce modern models for Hyundai Group OEM. OEM is widely used in consumer electronics market. Apple's iPhone and other products are manufactured by Taiwan's Foxconn. This can reduce the technical requirements for product production, and ultimately achieve the goal of reducing production costs. At present, major automobile manufacturers have begun to explore the use of this product production mode. Magna, a Canadian supplier of auto parts, has started to manufacture whole cars for several auto manufacturers, including BMW. Kia, a subsidiary of Hyundai Group, has also produced Picanto minicars for Hyundai.
The realization of Hyundai Group's investment plan will mark a milestone for mainstream automobile manufacturers to enter the OEM mode. Although Hyundai Group has confirmed this investment plan in principle, it is still seriously studying the feasibility, timeliness and safety of producing its vehicles in the incomplete holding market.
According to South Korean media reports, Hyundai Group and Guangzhou Government jointly invested in the establishment of a factory that needs to invest 500 billion won (after 3 billion yuan), planned to be completed and put into production in 2020, with an annual production of 100,000 cars expected. Korea Group will invest 40 billion won (240 million yuan). Although the top management of Hyundai Group has approved the investment plan, the trade union of Hyundai Group has opposed the plan. Hyundai Group's trade unions are concerned that the new plant will have an impact on the employees of the existing Korean Group factories, possibly leading to job cuts and lower salaries. The trade union of Korea Group even thinks that this is a decision made by the group's top officials under the pressure of the Korean government.