Hyundai Launches Auto Finance Unit in China

Hyundai Motor Co. and its Chinese partner Beijing Automotive Industry Holding Co. are opening an automotive finance arm in China this month to boost sales of their vehicles.

Beijing Hyundai Auto Finance Ltd. has 500 million yuan ($79 million) in initial capitalization.

Within three years, the unit aims to be financing as much as 45% of the vehicles sold by Hyundai and affiliate Kia Motors Corp. in China. The two South Korean companies predict they will sell a combined 2 million vehicles in that country in 2016.

Analysts say about 10% of car buyers in China rely on auto loans, but they expect the rate to rise.