The country’s third largest car maker Hyundai Motor India is looking to build a diesel engine plant in the country. The auto maker has got an in-principle approval from its parent in South Korea, people familiar with the development said.
The firm is likely to invest at least Rs. 500 crore to build a factory that would have an installed capacity to produce around 100,000 engines, said people, who declined to be named. The capacity may be expanded later. Hyundai Motor India declined to comment on the matter.
The company is likely to introduce a diesel variant of its i10 hatchback model in the next eight-12 months and likely to import the engine to start with and eventually look at localizing the 1.1-litre diesel engine, the people said.
It also plans to localize the 1.4-litre diesel engine for i20 model, which is currently being imported. Localization of these engines is likely to bring down the cost of the cars by almost 15-20% .