Hyundai Motor's subsidiary, Hyundai Wia Corp., an automotive engine unit is building an engine factory in the Russian city of St. Petersburg.
A ceremony to mark the start of construction was held on Tuesday attended by the mayor of St. Petersburg and Hyundai officials.
The company has been using its Chinese plant to provide engines for its European factories, but this move will allow the firm to cut down on tariffs and logistics costs.
The factory will be able to produce two-hundred-40 thousand engines per year.
The company is looking to use the site as a foundation for its expansion into the European market.