Who needs a Hyundai car manufacturing plant in Kazakhstan and why
Let us tell about Hyundai Accent manufacture at the full-cycle plant in Almaty.
Not every manufacturer and country in the world history of machine building had its own full-cycle production facility from the start. Development in this sector happens gradually. Kazakhstan’s car industry has started its journey relatively recently and rapidly gaining momentum.
In April last year, the assembly shop of the domestic Hyundai Trans Kazakhstan car manufacturing plant, a subsidiary of Astana Motors, commenced its operations in Almaty. On 15 October 2020, the plant was fully launched with shops for body welding and painting, plastic part painting, assembly and component warehouse for completely knocked down vehicle production.
The area of the enterprise is 34 thousand m2 located on the territory of 25 hectares in the city’s Industrial Zone. In the nearest future, Astana Motors will build here another plant, for manufacturing of plastic parts.
The production capacity is 30 thousand cars per year at the first stage and 45 thousand cars at the second stage. From April to December 2020, the plant manufactured 8401 cars. By the way, the enterprise supplies all Hyundai models to the market. Hyundai Trans Kazakhstan manufactures 20 Hyundai Accent vehicles per shift by CKD production, and it’s just the beginning.
Informburo.kz investigated how the cars were made and whether it was true that it was a simple assembly with attaching of wheels.
No.1. Hyundai Accent is a made by full-cycle production
The manufacture at Hyundai Trans Kazakhstan plant is not attaching of wheels, but a complex labor-intensive process including body welding and painting, painting of plastic parts, assembly of dashboards, seats, engines, doors, trunk lids, etc. Hyundai Accent is manufactured in Almaty by full-cycle production. According to General Director of Astana Motors Beknur Nesipbayev, a full cycle means that over 700 process operations are performed from the start of production until completion.
The entire production is controlled by Hyundai Motor Company engineers sent from South Korea.
The Hyundai Trans Kazakhstan plant was built using modern technologies of the global motor industry and meets all environmental requirements. The plant’s equipment was manufactured in South Korea specifically on Hyundai Trans Kazakhstan’s order. The equipment manufacturers are Hyundai Motor Company, Obara, Korea Hoist, Durr Korea, Korea Tech, Hyundai Rotem, Pailant and others. The equipment was installed at the plant by Hyundai Motor Company and Youngsan (South Korea) specialists.
Hyundai Trans Kazakhstan meets the requirements of Hyundai Motor Company and holds certification documents from VCA (Great Britain), RDW (Netherlands), TÜV Rheinland Korea and other companies certifying world-class plants in Europe, USA and Asia.
The plant was built in compliance with all environmental standards. The painting shop is equipped with air and water filtration systems.
No.2. Car manufacturing process. Step 1. Acceptance of components
First, various components from Russia, South Korea, India, and China arrive at the plant, says Beknur Nesipbayev.
Hyundai Trans Kazakhstan plant. Body welding shop
No.3. Car manufacturing process. Step 2. Body welding
After delivery of the formed parts, the special Hyundai equipment is used to weld the front and rear parts, sides, roof panels and bottom of a car. All these parts are then combined on the main conductor and the welding is completed.
Then, the car gets its VIN applied, and the doors, trunk lid and hood are attached.
No.4. Car manufacturing process. Step 3. Body painting
Quality of work is monitored at each stage by the specialists from South Korea and responsible Hyundai Trans Kazakhstan employees.
After examination, a body is transferred from the welding shop to the painting shop where it gets to the preparation line and then to the cataphoresis line.
The preparation line includes 9 baths (cleaning, washing, activation and phosphating) and the cataphoresis line includes 5 baths (cataphoresis and washing).
This is followed by drying of cataphoretic primer, after which the car is ready for painting, once the body is primed and dried, it is painted, lacquered and dried again. The painted body undergoes final quality control.
Hyundai Trans Kazakhstan plant. Body painting shop
No.5. Car manufacturing process. Step 4. Assembly
After the painting quality check, the car is sent to the assembly line where the interior is installed starting from the ceiling lining and to the floor lining. Auxiliary stations assembly dashboards, seats, front and rear suspensions, transmission and engine, all these are assembled and sent to the main line where the complete assembly is done.
No.6. Car manufacturing process. Step 5. Finished car quality control
After assembly of all parts, the car is filled with the necessary fluids, such as antifreeze, oil, braking fluid, etc. Then the car goes for quality control for a check of wheel alignment, operation of brakes and headlight adjustment. The vehicle’s waterproofing is tested separately: in a special chamber, pressurized water and air jets are used to ensure that the interior is airtight and there are no water leaks.
That is followed with verification assembly check before the car is taken for a drive test at the plant’s proving ground. If all tests are passed, the car is sent to a dealer.
Hyundai Trans Kazakhstan plant. Body welding shop
No.7. Who funded the plant construction?
The total scope of investment into the project exceeded 28 bln tenge. 30% (over 8 bln tenge) were own funds of Astana Motors and 70% (20 bln tenge) were borrowed from Development Bank of Kazakhstan and Industry Development Fund.
The project was implemented with support from the Ministry of Industry and Infrastructure Development of the Republic of Kazakhstan, the Investment Committee of the Ministry of Foreign Affairs of the Republic of Kazakhstan, and the Almaty Akimat.
No.8. Will this production affect the price of Hyundai Accent?
It will. The car will be cheaper due to localization of the production.
Press tour to Hyundai Trans Kazakhstan plant. Body painting shop. 16 February 2021
No.9. What will be the benefits of car manufacture for the country?
Car assembly plants contribute significantly to the economic growth and diversification, raise the level of the country’s innovative development and ensure growth of professional personnel.
First of all, there are new jobs. Today, the plant employs 370 people, but upon reaching its full capacity, it will be employing nearly twice as much – about 700 people. An average salary at the enterprise is 250 thousand tenge. Each employee is provided with free meals and transportation to the plant and back home. By the way, the cost of one work place is 40.1 mln tenge.
As the global experience shows, machine building has a multiplicative effect on development of associated industries, improves population employment and thus ensures the country’s competitiveness in general.
According to the estimates, one job at the plant produces up to 15 jobs in associated industries (service, sales, logistics, insurance, banking, marketing, manufacture of car parts).
Besides, more taxes are paid to the country’s budget. In 2020, Hyundai Trans Kazakhstan paid 444 mln tenge.
After obtaining the Kazakh certificate of production with 51% localization, the company will be able to export the cars to the Central Asia and the Customs Union countries.
Hyundai Trans Kazakhstan. Final inspection line
No.10. Will the plant manufacture other Hyundai models?
Hyundai Trans Kazakhstan plant is planning to commence CKD production of one more model before the end of 2021.
Thus, gradually mastering the welding and painting of each model, having built a plastic component plant, Astana Motors is planning to increase the Kazakh content in the machine building sector, raise a new generation of qualified personnel and develop the domestic car industry.
50% of the total number of Astana Motors manufactured cars will be sold on the market of Kazakhstan and 50% will be exported to the CIS countries. The company is already exporting Hyundai cars to Uzbekistan, and this year it starts supplies to Belarus.
Hyundai has become the leader on the Kazakhstan’s car market in 2020. Hyundai sales in Kazakhstan amounted to 17,857 cars in 2020, a 20.2% growth compared to 2019. In Uzbekistan, 3,561 Hyundai cars were sold in 2020, a 1,359.4% growth compared to 2019.
In total, Astana Motors sales at the end of 2020 grew by 24.4% and reached 26,826 new cars. The company’s market share in Kazakhstan was 25%.
At the end of last year, Astana Motors become one of the largest taxpayers in the car industry of Kazakhstan, having paid 29.4 bln tenge to the local and republican budgets. The gross sales of the company in 2020 were $850 mln, which is over 360 bln tenge.
Source: informburo.kz