• search

S Korea regulator to probe Hyundai Motor, Kia

Written by: Staff

SEOUL, Feb 22 (Reuters) South Korea's antitrust agency said on Wednesday it would investigate the country's top auto maker, Hyundai Motor Co., and its affiliate, Kia, over allegations they had unfairly asked parts suppliers to cut prices.

The move by the Fair Trade Commission (FTC) comes after parts suppliers complained about requests from Hyundai and Kia Motors Corp. to cut supply prices -- apparently to offset the impact of a firmer won ''We will investigate whether the price cuts were taken unilaterally by the conglomerate or made in line with lower prices on the auto parts markets,'' an FTC spokesman said by telephone, adding that the investigation would start this month.

Despite news of the probe, shares in Hyundai rose 0.98 percent to 82,400 won by 0040 GMT, and Kia was up 1.74 percent at 20,450 won, both outpacing a 0.49 percent gain in the broader market Hyundai and Kia, together the world's number 7 automobile supplier, said last week they aimed to lower production costs by reducing the amount they pay for auto parts by 5 percent to 10 percent in order to shield themselves from the surging won.

The won has risen 4.1 percent against the U.S. dollar so far this year, hurting South Korean exporters' competitiveness abroad and returns on sales abroad.

Officials at the two companies declined to comment on Wednesday on the latest FTC move.

Hyundai and Kia are aiming to increase overseas production to reduce the risks from changes in foreign exchange rates.

Hyundai opened its first U.S. plant in Alabama last year and has factories in China, India and Turkey.

It also is in talks with the Czech Republic to set up a 1 billion euro (.19 billion) factory and is discussing a commercial vehicle joint venture in China.

Kia has a plant in China and is building factories in Slovakia and China. It is also looking for a site for its first North American plant.


For Daily Alerts

For Breaking News from Oneindia
Get instant news updates throughout the day.

Notification Settings X
Time Settings
Clear Notification X
Do you want to clear all the notifications from your inbox?
Settings X
We use cookies to ensure that we give you the best experience on our website. This includes cookies from third party social media websites and ad networks. Such third party cookies may track your use on Oneindia sites for better rendering. Our partners use cookies to ensure we show you advertising that is relevant to you. If you continue without changing your settings, we'll assume that you are happy to receive all cookies on Oneindia website. However, you can change your cookie settings at any time. Learn more