AUTOSHOW-Hyundai China JV facing "severe challenges" in complex political environment -chairman

* Hyundai-Kia's China sales dropped 52 pct in March

* Anti-Korean sentiment stems from missile dispute

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SHANGHAI, April 19 (Reuters) - The China joint venture of

South Korea's Hyundai Motor Co is facing "severe

challenges" due to a complex political, economic and competitive

environment, its chairman said on Wednesday, amid a political

stand-off between Beijing and Seoul.

The carmaker has seen its sales hit in the country and has

sharply cut production amid anti-Korean sentiment over the

planned deployment of a U.S. missile defence system outside

Seoul and rising competition from Chinese brands.

"At the moment given the complicated political, economic and

competitive market environment, Beijing Hyundai faces what we

can describe as severe market challenges," Xu Heyi, chairman of

Beijing Hyundai Motor Co, said at an event at the Shanghai auto

show.

Beijing Hyundai is a joint venture between Hyundai and BAIC

Motor Corp Ltd.

Hyundai and affiliate Kia Motors Corp saw

combined China sales slump 52 percent in March from the same

month a year earlier. China, the world's biggest auto market,

accounted for over a quarter of the pair's 2016 overseas sales.

In contrast, rivals Toyota Motor Corp, Honda Motor

Co Ltd and General Motors Co reported increases

in China sales last month.

(Reporting by Brenda Goh; Writing by Adam Jourdan; Editing by

Christopher Cushing)