(AFP) South Korean carmaker Hyundai Motor Co today unveiled plans to expand in Southeast Asia to take advantage of the planned opening in 2003 of a regional free trade area.

Hyundai's vehicles are now locally assembled here and Indonesia and the company wants to venture into the Philippines and Thailand, said Hyundai Motor director Um Kwang Heum.

It aims this year to sell 30,000 cars in Asia excluding India and China, he said after launching the first Hyundai Elantra model fully assembled locally.

"Apart from Malaysia, we have another CKD (completely knocked down) plant in Indonesia. We are considering another smaller CKD project in the Philippines and possibly later on in Thailand," he told a press conference.

Hyundai's director for Asia operations, Kim Kwan Jong, told AFP that the company was reviewing its marketing strategy to benefit from the ASEAN Free Trade Area (AFTA).

Indonesia is the company's biggest market in the Association of Southeast Asian Nations (ASEAN), but Kim said Hyundai has been unable to invest in the region as much as its Japanese rivals due to financial problems in South Korea.

"Japanese carmakers have invested so much here... I think it (AFTA) will give us a good chance for us to start from scratch as long as we efficiently plan our future strategies," he said.

Under AFTA, tariffs among the most developed ASEAN members are due to fall to below five percent at the start of 2003. Malaysia has obtained a two-year reprieve for its fledgling auto industry.

Increased sales

This year, Kim said Hyundai projected global sales to rise to 1.7 million units, up from 1.4 million last year. It forecast a global turnover of RM72 billion this year, about 30 percent higher than 2000.

Um said the United States remained Hyundai's biggest market worldwide, accounting for about 40 percent of total exports. The slowdown there had not hurt sales, he said.

"Because of our new models, we are increasing sales in the US market... we are targeting to sell 370,000 units this year," he added.

On whether Hyundai would build a manufacturing plant in the US, he said: "We are still thinking about it... maybe two to three years down the road. Now we do not have any decision."

Hyundai in March signed a licence agreement with local firm Oriental-Hyundai Sdn Bhd to assemble and distribute Hyundai vehicles and to make components.

Oriental group managing director Robert Wong said the locally assembled Elantra launched today marked a new era for Korean cars here.

"The local vehicle market has all along been dominated by Japanese and continental makes... the new Elantra is a most appropriate model in this price sensitive market," he said.

Oriental Holdings also assembles and distributes Honda cars here. It also assembles Mercedes and Peugeot vehicles on a contract basis.