AUTOMOTIVE

ASIA: Politics and New Designs alter the face of the Asia Pacific Automotive markets.

The long term impact of the arrest and indictment of Hyundai Chairman Chung Mong Koo is yet to be determined. He has been accused of creating slush funds to pay politicians and officials for business favours. The groundbreaking for two new overseas plants subsidiary Kia's in the US and Hyundai' in the Czech Republic have already been postponed. However, work on the joint venture engine factory in China, Beijing Hyundai, started as scheduled on May 16.

Mahindra & Mahindra, a leading Indian vehicle manufacturer, reported a 23% rise in net sales to Rs83.26bn for the year ended 31 March 2006. The company will launch the Logan, in association with Renault, in the first half of 2007.

Honda have announced that they are developing an entirely new compact car to be targeted primarily at the Indian market. Tata, General Motors, Fiat and Toyota are also developing new models for this sector which accounts for 75% of the Indian market.

The Chinese government, concerned about over capacity in the automotive industry, is reported to now require companies to prove that consumer demand justifies additional investment before giving approval