FAME, a state-run enterprise under the Peruvian Army, is moving forward with the construction of a new assembly plant for military and special-purpose vehicles. As part of Peru’s defense modernization strategy, the project aims to boost combat readiness and promote collaboration with South Korean firms such as Kia, Hyundai Rotem, KG Mobility (KGM), and STX through local production and technology transfer.
According to the Peruvian government on the 28th, FAME has begun building the new facility, which will span approximately 0.49 acres. The plant will house assembly lines, quality control zones, testing areas, and logistics and storage spaces. Equipment installation is expected to begin in the coming weeks.
The investment is intended to support the production of new vehicles for military use, though specific models have not yet been disclosed. FAME has stated that it will prioritize the involvement of local businesses and workforce in the manufacturing process.
The new factory is also expected to enhance ongoing cooperation with Korean companies. In announcing the project, FAME highlighted its existing ties with Kia, Hyundai Rotem, KGM, and STX. Given the previous discussions around technology transfer and local assembly, the plant’s construction is anticipated to positively impact follow-up negotiations.
Hyundai Rotem and STX signed a $60 million contract with FAME in May last year to supply 30 K808 “Baekho” wheeled armored vehicles, with an option to deliver up to 120 units. The two companies are working with FAME to establish a local production facility to support assembly and long-term sustainment.
KGM delivered 400 Musso Sports vehicles to the Peruvian government last year for official use and plans to increase the volume to approximately 2,000 units this year. In March, KGM signed a memorandum of understanding (MOU) with FAME and STX to expand supply and pursue technology collaboration.
Kia has also supplied its KM420 light tactical vehicles to Peru, further underscoring the deepening defense and mobility cooperation between the two nations.
