By Janaki Krishnan
MUMBAI, Dec 20 (Reuters) - South Korean car maker Hyundai Motor Co's India unit expects its exports to fall by a quarter next year due to shrinking overseas demand, a company spokesman said.
To cope with the decline in demand, Hyundai Motor India Ltd is cutting production shifts at its plants, he said.
'We have enough orders on hand till the end of this year, but order flow in November and December has not been good and this will reflect in sales from January onwards,' the spokesman told Reuters late on Friday.
The lag effect will result in a near 25 percent drop in exports from January onwards, he added.
Globally auto makers are facing depressed demand due to the economic slowdown and expect the downturn could extend to 2010.
South Korean automakers are expected to see exports and local sales fall 6 percent in 2009, after declining 5.2 percent in 2008.
Earlier this month Hyundai Motor had said it was launching output cuts in most of its factories abroad due to falling sales.
In November, exports from the Hyundai unit, India's second-largest carmaker, rose 188 percent, but the orders were placed about three months previously, when the meltdown had just started.
In 2008, exports have risen 170 percent, the spokesman said.
It exports to about 95 countries, with the major chunk of the demand coming from Europe. Small-sized cars accounted for the largest proportion of exports, data from industry body Society of Indian Automobile Manufacturers showed.
November was a difficult month for carmakers in India, with domestic sales falling by one-fifth, the worst in eight years.
CUTS IN SHIFT
Falling demand has prompted Hyundai India to undertake production cuts by reducing shifts, while considering a cut in its temporary workforce, the spokesman said.
One of its two units, from which exports are made, has been working two shifts over the past month compared with three shifts previously, while the second unit which caters to domestic sales may soon start working only two shifts from January, he said.
'Its not yet been decided. We are working on that.'
The company is also considering how to deal with its 3,300-strong temporary workforce.
'We are considering how best to reduce or reshuffle them. There is no figure to the layoffs,' he said. 'We have no firm plans for retrenching at this point of time.'
In November Hyundai India's production rose 39 percent while in the period April to November it has risen 55 percent.
Shares in Hyundai Motor closed down 0.44 percent on Friday in Seoul.
(Editing by Ben Tan) Keywords: HYUNDAI/EXPORTS (janaki.krishnan@thomsonreuters.com, +91-22 66369138; Reuters Messaging: janaki.krishnan.reuters.com@reuters.net) COPYRIGHT Copyright Thomson Reuters 2008. All rights reserved. The copying, republication or redistribution of Reuters News Content, including by framing or similar means, is expressly prohibited without the prior written consent of Thomson Reuters.
MUMBAI, Dec 20 (Reuters) - South Korean car maker Hyundai Motor Co's India unit expects its exports to fall by a quarter next year due to shrinking overseas demand, a company spokesman said.
To cope with the decline in demand, Hyundai Motor India Ltd is cutting production shifts at its plants, he said.
'We have enough orders on hand till the end of this year, but order flow in November and December has not been good and this will reflect in sales from January onwards,' the spokesman told Reuters late on Friday.
The lag effect will result in a near 25 percent drop in exports from January onwards, he added.
Globally auto makers are facing depressed demand due to the economic slowdown and expect the downturn could extend to 2010.
South Korean automakers are expected to see exports and local sales fall 6 percent in 2009, after declining 5.2 percent in 2008.
Earlier this month Hyundai Motor had said it was launching output cuts in most of its factories abroad due to falling sales.
In November, exports from the Hyundai unit, India's second-largest carmaker, rose 188 percent, but the orders were placed about three months previously, when the meltdown had just started.
In 2008, exports have risen 170 percent, the spokesman said.
It exports to about 95 countries, with the major chunk of the demand coming from Europe. Small-sized cars accounted for the largest proportion of exports, data from industry body Society of Indian Automobile Manufacturers showed.
November was a difficult month for carmakers in India, with domestic sales falling by one-fifth, the worst in eight years.
CUTS IN SHIFT
Falling demand has prompted Hyundai India to undertake production cuts by reducing shifts, while considering a cut in its temporary workforce, the spokesman said.
One of its two units, from which exports are made, has been working two shifts over the past month compared with three shifts previously, while the second unit which caters to domestic sales may soon start working only two shifts from January, he said.
'Its not yet been decided. We are working on that.'
The company is also considering how to deal with its 3,300-strong temporary workforce.
'We are considering how best to reduce or reshuffle them. There is no figure to the layoffs,' he said. 'We have no firm plans for retrenching at this point of time.'
In November Hyundai India's production rose 39 percent while in the period April to November it has risen 55 percent.
Shares in Hyundai Motor closed down 0.44 percent on Friday in Seoul.
(Editing by Ben Tan) Keywords: HYUNDAI/EXPORTS (janaki.krishnan@thomsonreuters.com, +91-22 66369138; Reuters Messaging: janaki.krishnan.reuters.com@reuters.net) COPYRIGHT Copyright Thomson Reuters 2008. All rights reserved. The copying, republication or redistribution of Reuters News Content, including by framing or similar means, is expressly prohibited without the prior written consent of Thomson Reuters.
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