Shinhwa ploughs US$42m into new Alabama factory

Parts manufacturer, Shinhwa Group is to plough US$42m into a new plant in Auburn, Alabama.

"Shinhwa's decision to invest US$42m and create 95 jobs in Auburn is great news for Alabama," said Alabama Governor, Kay Ivey.

"Alabama has become an important player in a changing automotive industry and Shinhwa's plans to open its first US plant in Auburn is proof of our success."

Alabama is home to a growing automotive cluster which produces around 1m vehicles a year and provides an estimated 40,000 direct jobs at companies within the sector.

"The Shinhwa Group has become a leader in the aluminium die casting industry because of our willingness to overcome technical challenges," said Shinhwa Group in South Korea CEO, Kwi-Hyun Lee.

Initially, Shinhwa will produce drive shafts for vehicles made by Hyundai Motor Manufacturing Alabama in Montgomery and Kia Motor Manufacturing Georgia, just across the State line in West Point.

Shinhwa plans to expand its production in Auburn in the future to provide parts for other car manufacturers.

"We will start our US project by introducing a highly automated machining process to be followed in the near future with our die casting lines," said Shinhwa US Auto president, Duk Keun Oh.

"We are grateful for our collaboration with Seohan in Auburn and see great opportunities for our growth in North America."

Shinhwa was founded in Changwon, South Korea, in 1995 and the Auburn operation will be its first manufacturing location in the US. The company has started construction of its new facility in Auburn Technology Park West and phase one of the project is expected to be completed in summer, 2020.

Employment at parts manufacturers across Alabama has nearly doubled since 2009 to 25,800 positions in 2019, according to data from the St Louis Federal Reserve Bank and the Alabama Department of Labour.

The State is home to more than 150 suppliers.

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