Naza to Set Up India Auto Assembly Plant TEAMCAR - Malaysia's Naza Automotive Manufacturing will set up a 950 million ringgit (US$259 million, euro215 million) assembly plant in India, marking its first foray into South Asia, a news report said Tuesday.

Naza, which mainly imports and assembles vehicles for South Korea's Kia Motors Corp., is set to sign a memorandum of understanding with the state government of Tamil Nadu next month to build the factory in the Sriperumbudur business hub in Chennai, Works Minister S. Samy Vellu was quoted as saying by the New Straits Times.

The company plans to sell Naza and Kia vehicles in India as well as export them to Nepal, Sri Lanka and other neighboring countries, he said, according to the report.

No other details were available. Naza officials could not be immediately reached for comments.
Naza, which began operations in 1976, also has an agreement with France's Peugeot SA to assemble the Peugeot 206 model for sale in Malaysia, Indonesia and Thailand.

In April, Naza launched its own 1.1-liter compact car, which it developed in collaboration with Italian, British and South Korean designers and has said it planned to export the car. The privately owned company will become the third Malaysian auto player _ after national carmakers Proton and Perodua _ to export locally developed passenger cars.

The New Straits Times said Naza is expected to set up more assembly plants abroad to take advantage of cheaper labor and raw material cost, and expand its export business.

Naza has two plants in Malaysia and is building its third and biggest plant in northern Penang state. The new 1.3 billion ringgit (US$354 million; euro295 million) plant is expected to roll out cars by 2008 with an annual production capacity of 100,000 units, officials said.  ¶ 2:58 PM