2012.06: Dongfeng Yueda Kia has finally made an official announcement on its much talked about third production site. According to a report appearing on auto.163.com today, the site will be located in Yancheng, Jiangsu, home to its two other factories. Construction on the site will begin on June 29.
The joint venture has invested a total of $814 million on the site, which will also cover the construction of a technology center. The site is scheduled to begin operation in 2014, with an expected annual production capacity of 730,000 units. At maximum output the site’s annual capacity is anticipated to break the one million barrier.
Dongfeng Yueda Kia made significant gains last year. When the average industry growth rate slipped down to the single digits, the JV still managed year-on-year growth of 30.3 percent. It was one of the few manufacturers to successfully fulfill its sales target last year. The JV’s two factories were pushed to their respective limits last year. Now that the JV has stated its intention to sell 480,000 vehicles this year, it must start tackling its problem of limited production.
According to General Manager Su Nanyong, thanks to labor reorganization and resource allocation, the JV’s overall production capacity is now approximately 540,000 vehicles. Although the figure is enough to cover its anticipated sales goal this year, the establishment of the newest site shows that the JV’s existing facilities are still under a considerable amount of pressure.
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