Hyundai Motor Group said Wednesday it has sold its Chongqing plant in China to the region’s industrial park developer Yufu Industrial Complex Construction Co. for approximately 1.62 billion yuan ($290 million), as part of a global operational restructuring aimed at shifting focus from volatile markets to expanding in growing Asian countries like India and Indonesia.

The sale comes in the wake of the company's dwindling market share in China, which fell to 1.4 percent in 2023. This decline is attributed to multiple factors, including the rising popularity of local car brands, governmental policies favoring domestic manufacturers and geopolitical strains.

"In our quest to boost business efficiency in China, selling the Chongqing plant is a step towards enhancing profitability by streamlining our production operations," a Hyundai Motor Group official said.

Established in 2017 with a capital injection of 1.6 trillion won ($1.2 billion), the Chongqing plant was Hyundai's fifth Chinese plant boasting an annual production capacity of more than 300,000 units. Its acquisition by Yufu Industrial Park Construction Company, with the majority shareholder being Liangjiang New Area Development & Investment Group Co., Ltd., owned by the city of Chongqing, shows the city's significant role in the deal. Plans are in place to convert the plant into an electric vehicle production facility, managed by Chongqing Liangjiang New Auto, another subsidiary of the investment group.

This transaction follows Hyundai's 2021 sale of its Beijing Plant 1, reducing its manufacturing footprint in China from five to three facilities. The rapid sale process, which began in late August of the previous year, initially sought 3.68 billion yuan for the plant. However, the final sale price was considerably lower due to a downturn in the Chinese market.

Hyundai's global realignment also includes the decision by the board to sell off its Russian plant in Saint Petersburg amid the ongoing conflict in Ukraine. Meanwhile, the group is bolstering its presence in India and the ASEAN region.

Hyundai has been a major player in the Indian market since 1996, with over 9 million vehicles sold. In August last year, it acquired General Motors' Talegaon plant in Maharashtra, India, with plans for an investment of about 70 billion rupees ($842 million) to boost EV production, aligning with India's EV expansion policies.

In the ASEAN region, the company has been ramping up its EV production facilities and model range in its Indonesian plant since last year.