Hyundai Wia said to be discussing $711 mn parts contract with Fiat Chrysler

2021.02.05 14:34:46 | 2021.02.05 16:56:31

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Hyundai Wia Corp., South Korea’s factory machinery and auto parts making unit under Hyundai Motor Group, is likely to supply 800 billion won ($711.4 million) worth auto parts to Fiat Chrysler Automobiles (FCA).

Hyundai Wia is close to sign a supply deal with FCA for its power transfer unit and road departure mitigation system, according to industry sources on Thursday. FCA sent out its official letter for the order last month and the two companies now are making the final touches to their contract.

An official from Hyundai Wia however denied the news, saying the company is in contact with various clients and nothing has confirmed yet.

Shares of Hyundai Wia fell 2.57 percent to 98,400 won by midday Friday.

Hyundai Wia’s power transfer unit is a key part of Hyundai Motor’s HTRAC all-wheel drive system, delivering driving power of engine/transmission to the back wheels. With the system, cars are able to drive safe on wet, snow and icy roads.

It was applied to Hyundai Santa Fe SUV for the first time in 2018. The company has been active in supplying the power transfer unit to global automakers, other than Hyundai Motor family units.

Hyundai Wia is now aiming to expand the order list to ship 2 trillion won worth active transfer case and other parts.

FCA recently has completed its merger with PSA Group, bringing together 14 vehicle brands across the globe including Peugeot, Citroën, Chrysler and Jeep and becoming the world’s fourth biggest automaker by volume and third biggest by revenue.

The latest order is expected to bolster the top line for Hyundai Wia. The company earlier announced its sales target to achieve 12 trillion won by 2030.

Hyundai Wia has kept up efforts to expand its client base beyond Hyundai family for revenue growth. It signed an 840 billion won contract to supply engines to Chinese finished car maker Changfeng Motor Co. for the first time among Korean parts makers in February 2019.

By Seo Dong-cheol and Lee Ha-yeon

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