(Yicai) Aug. 24 -- Beijing Hyundai Motor, a Chinese joint venture of South Korean carmaker Hyundai Motor and China's BAIC Motor, plans to sell its factory in Chongqing for at least CNY3.7 billion (USD508 million) due to idle production capacity amid a slide in sales, China Beijing Equity Exchange said earlier this week.

Located in the city’s Jiangbei district, the plant has land use rights and includes buildings, equipment, spare parts inventory, office furniture, and projects under construction. It is not yet clear who may buy the plant, but they must meet certain requirements, and Hyundai will decide after consulting with regulators and experts, according to the statement.

The Chongqing factory, Beijing Hyundai's fifth, broke ground in 2015 and became operational in 2017, with the company investing CNY7.8 billion (USD1.1 billion). It has an annual production capacity of 300,000 cars, including the Encino, Lafesta, and ix25 models.

Beijing Hyundai's sales have shrunk since peaking at 1.1 million autos in 2014. It sold only 284,000 last year. This has led the carmaker to dispose of plants. Chinese electric vehicle startup Li Auto took over Beijing Hyundai's first plant in China's capital in 2021, while according to a rumor from last year, Xiaomi Auto will buy its Cangzhou factory.

Faced with low sales and overcapacity, Beijing Hyundai aims to get out of the predicament by scaling down output and accelerating its transformation. The JV plans to fully upgrade its fuel vehicles to hybrids by 2025 and launch new hybrids and EVs.

Editor: Martin Kadiev