By Hyunjoo Jin and Aditi Shah
SEOUL/NEW DELHI (Reuters) - South Korea's Kia Motors Corp is expected to pick a site next month for its first factory in India, stepping up plans to start making cars in one of the world's fast-growing auto markets, two people familiar with the matter said.
The move would enable Kia to leverage the existing supplier base of its affiliate Hyundai Motor Co, India's second-biggest automaker by sales. The proposed factory would start production in 2019 and eventually have capacity to make 300,000 vehicles a year, one of the people told Reuters.
The Korean pair, jointly the world's No.5 carmaker, are chasing new business after missing annual targets in 2015 for the first time since the 2008 global financial crisis. Their combined sales fell 2 percent in first-half 2016, hit by weakness in markets like China, Russia and Brazil.
The size of the investment has yet to be decided, one of the people said, declining to identify which models will be produced at the factory.
Three sites are under consideration for the plant, and Kia may announce the plan in September after deciding on a location in August, the second person said.
The people spoke on condition of anonymity because the project was confidential.
The states of Andhra Pradesh, Maharashtra and Gujarat have all been wooing Kia, according to two other people with knowledge of the matter. One of the two, an official with the Andhra Pradesh administration, said the state - which neighbours Tamil Nadu, home of Hyundai's existing plants near Chennai - is the frontrunner.
Kia said in a statement to Reuters on Thursday that it was "continually evaluating potential locations for overseas manufacturing facilities, including India, to secure additional engines for future growth. However, as of now no concrete plans have been finalised."
(Reporting by Hyunjoo Jin in SEOUL and Aditi Shah in NEW DELHI; Additional reporting by Nidhi Verma in NEW DELHI; Editing by Tony Munroe and Kenneth Maxwell)
