'Export Halt' Kia Motors, Sohari Plant to Have Consecutive Shutdowns Next Month... Hyundai Motors Also 'Uncertain' (Comprehensive)

Sohari 1·2 Factories to Close About Half in May
Porter Line to Suspend Operations Following Hyundai Tucson Line

Kia Sohari Plant, Gwangmyeong-si, Gyeonggi-do (Photo by Yonhap News)

[Asia Economy Reporter Kim Ji-hee] Kia Motors' Sohari plant will ultimately enter a series of shutdowns until next month. This is due to a shortage of parts inventory caused by the halt of major automobile markets such as the United States amid the COVID-19 pandemic, making it inevitable to adjust export production volumes.

According to the industry on the 23rd, Kia Motors labor and management agreed to suspend operations at Sohari Plants 1 and 2 from April 27 to May 10 and from May 22 to 25. Initially, Kia had planned to shut down all domestic plants from April 30 to May 5 by utilizing Labor Day holidays and substitute holidays. The Sohari plant will add five more days of shutdown, operating only 13 days in total next month. Departments linked to finished vehicle production within the Sohari plant will also rest during this period.

The Sohari plant, along with Gwangju Plant 2, is considered one of the Kia domestic plants with a high proportion of export vehicles among the nine domestic plants. The Sohari plant produces models such as the Stinger, K9, Carnival, and Pride, with Carnival and Pride having a significant export ratio.

This shutdown does not completely eliminate the possibility of additional shutdowns at Kia's domestic plants. There are considerable concerns that relay shutdowns may continue if the global spread of COVID-19 persists. Other finished vehicle plants are already experiencing inventory overflow due to blocked export routes. Kia's Hanam bus line will suspend operations for five days from today until the 29th, and the monthly production plan has been reduced by 40 units until June. Gwangju Plant 2, which was previously mentioned as a potential shutdown candidate along with the Sohari plant, also needs to adjust export volumes. There are expectations that additional shutdowns may be implemented for the Sohari plant after May 27.

Hyundai Motor Company Ulsan Plant Yard (Photo by Yonhap News)

Hyundai Motor is also unstable. Following the suspension of operations at Ulsan Plant 5 Line 2, where the Tucson is produced, for a week starting from the 13th, production of the Porter will now be halted. Ulsan Plant 4 Line 2 plans to conduct an additional shutdown of about three days around the vacation period from April 30 to May 5 to alleviate yard congestion caused by export order cancellations.

Meanwhile, according to the Korea Automobile Manufacturers Association, as of mid-April, the global plant operation rate of 13 finished car makers including Volkswagen, BMW, Daimler-Benz, Renault, PSA, GM, Ford, FCA, Tesla, Toyota, Honda, Nissan, and Hyundai-Kia Motors was estimated to be only about 29%. Among the companies, GM suffered the greatest impact, suspending operations at 34 out of 38 plants across 8 countries (89.5%), and Daimler-Benz experienced production disruptions at 24 out of 27 plants in 10 countries (88.9%). However, during this period, the suspension rate of Hyundai-Kia Motors was 35.3%, which was lower compared to major global finished car manufacturers.

This content was produced with the assistance of AI translation services.