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Slovakia commits €220m to support Kia's new assembly plant

"The creation of a Kia manufacturing facility in Europe is a very significant step in the growth and development of our company," said Yong-Hwan Kim, Chief Operating Officer of Kia Motors Corporation, speaking during the world launch of the Kia Cerato 5-door at the Geneva Motor Show.

Kia's new facility will be located near the city of Zilina, 200 kilometres north east of Bratislava. It will cover 150 hectares, with a 160,000 sq m floor area. Staff levels at the plant will rise to 2,400 people when production is at full capacity. The ground-breaking ceremony is scheduled for early next month, with first cars coming off the production line in November 2006.

"Our new factory will open doors to new market sectors and will help to establish Kia even more securely in the European marketplace. We are confident that 500,000 annual sales and a 3% market share in Europe will be within our grasp by 2008," concluded COO Kim.

Annual production rate at the Zilina plant is planned to reach 100,000 during 2007 and 200,000 by the end of 2008. Output will be split evenly between B-segment cars (both 3-door and 5-door models) and C-segment cars (3-door, 5-door and estate models) with gasoline and diesel engines.

In line with the maximum 15% of total investment permitted under national and EU regulations for state investment aid, the Slovakian government expects to disburse a total of €220m in support of Kia's investment, which is expected to total between €700 and €1bn. The Slovakian government will spend €40m in 2004 on land and facilities and supporting the training of personnel. €550m will be required on extending a motorway by 40km to serve Kia's logistics requirements. Total state investment in direct aid and infrastructure per new job will thus equate to over €90,000.

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