South Korean car manufacturer Kia Motors will buy at least 15 percent of Malaysian auto assembler Naza Automotive Manufacturing as part of its plans to develop a regional auto hub in Malaysia, a report said today.

Naza Automotive, a unit of the privately-owned Naza Group which distributes Kia vehicles in Malaysia, operates a RM300 million assembly plant in northern Kedah state, the Business Times said.

"We have agreed to own a minimum 15 percent stake in the factory. It's just a matter of time, probably next year. The factory will eventually be used as a regional hub for Kia," Kia's Kuala Lumpur-based Asia Pacific managing director Young S Koh was quoted as saying.

"Kia has big plans with Naza for Malaysia and the region," he said.

Kia sold some 900,000 vehicles worth 10.7 billion dollars worldwide in 2003, the daily said.

Growth in region

Last year it sold some 54,000 in Asia Pacific and expects to double the number to 100,000 units this year, with about one quarter coming from Malaysia, it said.

Koh said the region is expected to see overall growth of 30 percent in 2005.

The Naza plant may be used to assemble Kia vehicles for export to regional markets in the near future, he added.

The plant began operations in August, with output running at 6,000 vehicles so far, rising to 30,000 in 2005 and 40,000 from 2006 to 2008, the report said.