Hyundai to supply parts to China bus maker
Hyundai Motor Co, South Korea's top auto maker, said on Sunday it had agreed to supply parts for buses to Xiamen Golden Dragon Bus Co Ltd, a China's bus maker, Reuters reported.
The deal comes as Hyundai is in talks with Guangzhou Automobile Group Co to set up a commercial vehicle joint venture in the world's second-largest car market.
Hyundai said in a statement that the world's No.5 auto maker along with its affiliate Kia Motors Corp, would sell parts for about 17,100 buses to Xiamen Golden Dragon Bus for five years from this month.
Hyundai did not disclose the value of the deal.
Xiamen Golden Dragon Bus is China's third-biggest bus maker, selling about 25,000 buses there, according to Hyundai.
Hyundai has been in negotiations with Guangzhou Automobile on a commercial vehicle venture in China with $1.2 billion as the two companies signed a memorandum of understanding (MOU) in June 2005.
But Hyundai and Guangzhou Automotive have not made any announcement yet and some South Korean media reported Hyundai had postponed the plan.
Earlier this week, the Seoul Economic Daily said Hyundai had delayed the plan for commercial vehicle joint venture in China indefinitely as Hyundai could not make profit under the current conditions, quoting a company official.
However, a Hyundai spokesman said the two firms were still in negotiation.
"We are still in talks and nothing has been decided yet," Jake Jang, a company spokesman said by telephone.
On Friday, shares in Hyundai ended up 5.01 percent at 71,200 won in Seoul's stock market, outperforming a 1.96 percent rise in the broader market .