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A ground-breaking ceremony was held on Friday April 3 at the site in Changzhou, Hebei province, the automaker said in an announcement the same day.
The factory, which is fully-equipped with press, body, paint and assembly lines, as well as an engine plant, will have initial capacity to manufacture 200,000 passenger cars per year. The plant is scheduled to come on stream at the end of 2016.
There are plans to expand its capacity to 300,000 units per year in 2018, Hyundai Motor said.
The company also unveiled plans to break ground during the second half of this year on a planned plant in Chongqing city in south-west China.
The move will help Hyundai Motor expand its share of China’s burgeoning auto market, which is expected to experience a surge in demand for cars through government in-land development efforts, the company added.
China is Hyundai Motor’s largest market in terms of sales.
While the company has three manufacturing plants in the country with a total capacity of 1.05 million units, in 2013 it produced 1.08 million units in China, with 1.07 million sold in the region.
This compares with an output of 1.85 million units in South Korea but domestic sales of only 641,000 units the same year.
Hyundai Motor, South Korea’s largest carmaker, is building a new automobile manufacturing plant in northern China as part of its plans to capitalise on the growing vehicle demand in the country.