Hyundai announces $388M expansion in Montgomery

Expansion talk has swirled around Hyundai’s Montgomery assembly plant for years as the sedan-heavy company struggled to adapt to an SUV-hungry U.S. market. But when the expansion arrived, it wasn’t to build new SUVs.

Hyundai announced Tuesday that it plans to invest $388 million to build a 260,000-square-foot engine head manufacturing plant to produce its next-generation engine, which includes new technologies and components, as well as updating its existing engine plant. The engines will be used in Montgomery and at the Kia facility in West Point, Georgia, construction should be finished next year.

It will mean 50 new jobs with an average annual salary of $52,000.

Those workers start next March, but the company has already started fielding applications. Plant spokesman Robert Burns said some new positions will be taken by current employees, meaning Hyundai will have to hire people to do the jobs that current workers are leaving.

It’s the company’s biggest investment in the plant since it opened in 2005. And it may not even be the most important event at the plant this week.

Hyundai announced in March that the redesigned Santa Fe would be assembled entirely in Montgomery, part of a push to get a foothold in the SUV market. Full production starts Friday.

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The plant churned out only Sonata and Elantra sedans for several years, but car demand dropped with gas prices, and the plant had to cut back on its overall production. That led to layoffs of some temporary employees and midweek shutdowns of the assembly line.

The company even slowed the speed of the line to keep full-time employees working during the downturn.

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They’re expecting that to change with the rollout of the new Santa Fe. “We really believe that we've got a hot seller here,” Chris Susock, the plant’s vice president of production operations, said in March.

The plant itself has nearly 3,000 full-time employees. More than that work at suppliers across central Alabama, building parts that are used during the assembly process. As the plant’s work rises and falls, so do jobs at the suppliers.