SEOUL: South Korea's top automaker Hyundai Motor announced Tuesday a plan to invest US$270 million to build a second engine plant to meet growing demand in the United States.

The factory, specializing in 2.4-litre engines, will be part of Hyundai's current facilities in Montgomery, Alabama, with mass-production due to start in September 2008, the company said in a statement.

The South Korean firm has invested US$1.1 billion since 2005 on its Mongomery facilties, including a 3.3-litre engine plant.

The first Hyundai plant in the US has the capacity to produce 300,000 vehicles per year.

Sister company Kia Motors has also been constructing its first US plant in West Point, Georgia, since last year.

The new engine plant will "enable Hyundai to serve its growing manufacturing operations in the United States, including supplying engines to the new Kia (Motors) plant" in Georgia, the statement said.

Hyundai Motor Group, which includes Kia and other auto part affiliates, controls 70 per cent of South Korea's auto market, and continues to expand its overseas operations.

It aims to be one of the world's top five largest automakers. - AFP/yy