Hyundai Updates Engine Capacity in U.S.

Hyundai Motor Co. is spending $388 million to upgrade and expand its engine production facility in Montgomery, Ala.

The company says it will spend about $340 million to update production machinery throughout the factory to prepare it for the launch of Hyundai’s next-generation Theta II 4-cylinder engine next April. An additional $40 million will be used to build a 260,000 sq-ft building and equip it with a new engine head machining system for the Theta III.

The Montgomery facility will continue to supply current-generation 2.0-liter engines for Hyundai Elantra sedans. It will switch to the Theta III design for Hyundai’s Sonata sedans and Santa Fe crossover vehicles.

The engine plant makes about 700,000 engines per year. The facility supplies Hyundai’s plant in Montgomery and affiliate Kia Motors’ factory in West Point, Ga.