Hyundai Mobis President Lee Gyu-suk, left, accompanied by Slovak Prime Minister Robert Fico, speaks after the two sides clinched an investment agreement in Slovakia, Tuesday (local time). Under the project, the auto parts maker will establish a manufacturing facility for electric vehicle parts there. Courtesy of Hyundai Mobis

Hyundai Mobis will set up its new production line for electric vehicle (EV) parts in Slovakia, the auto parts maker said Wednesday, to advance its position in the European power electric (PE) systems market.

The project is worth 350 billion won ($257 million) and will be the firm's third European manufacturing facility, following ones in the Czech Republic and Spain.

The new production base will be built on a site of around 105,700 square meters in Slovakia's western town of Novaky. It will start operation by the second half of 2025.

The plant will focus on manufacturing power electric systems for EVs. These systems are integrated drive units incorporating electric motors and inverters that ensure optimal performance.

"With the support of the government of Slovakia, we will expand our electrification business in Central Europe, centered around the new PE system plant there," Hyundai Mobis President Lee Gyu-suk said.

Hyundai Mobis has maintained a strong business partnership with the Slovak government for over two decades, beginning with establishing its first subsidiary there in 2004 and constructing a module plant in the country's northwestern city of Zilina.

Slovakia houses plants of several global carmakers, such as Kia. The Korean automaker is also establishing an EV-dedicated plant in the country.

Hyundai Mobis hopes to leverage Slovakia's new electrification manufacturing hub as a foothold to expand its presence in the European EV market.

Even if global EV makers are delaying the timeline for the mass adoption of EVs, the European EV market is still considered highly lucrative, which is why Hyundai Mobis hopes to gradually increase its investment there.

Hyundai Mobis is already operating factories in its key strategic markets here and abroad. The firm's battery system plant in Indonesia, which broke ground last year, began mass production in July.

The company also runs electrification component production bases in a number of cities in its home country, so as for the firm to respond rapidly to the expanding global EV market.