Hyundai Group to ramp up prodn in India to 1.5M units, sell locally-made EVs by 2025

NEW DELHI: Indicating an aggressive expansion plan ahead of a planned IPO in India, Korean auto giant Hyundai Motor Group (HMG) has said it will increase its annual production in the country to 1.5-million units between Hyundai and Kia and will drive in five new electric cars from 2025, including an electric Creta.

The move was announced by HMG Executive Chair Euisun Chung during a visit to the country as he reviewed the group’s mid-to long-term future mobility strategies.

Chung said that the group will be expanding production in India between its two brands, with Hyundai moving production to one million units by 2025, while Kia ramping up to nearly 5 lakh units. A major focus of the group will be on electrics as it begins to locally produce competitive and cost-effective vehicles from 2025.

“The Group will expand its EV lineup and create an EV ecosystem to accelerate customer uptake and expand charging infrastructure. It will also strengthen its SUV sales leadership and promote social responsibility activities,” the company said.

Chung said by around 2030, HMG expects to see a substantial expansion in the EV market. “In anticipation of this evolution, Hyundai is focused on developing locally tailored EVs aimed at establishing us as a leading global EV brand… We also plan to proactively build charging stations at strategic locations – including dealerships – to facilitate the adoption of EVs.”

Hyundai is expected to be working on an IPO for India, as the company is spending Rs 32,000 crore in the country for various expansion activities.

The company said it has started work to add the Maharashtra factory – acquired from GM last year -- to Hyundai’s India production footprint. This will be completed by the middle of next year and bring in a fresh 2 lakh units to its current production capacity of 8.24 lakh units. Kia’s yearly production will also be expanded to 4.3 lakh units within the first half of this year. “Combined together, HMG will have the ability to produce approximately 1.5 million units annually in India,” Chung said.

On EVs, he said that Hyundai will unveil its first locally-produced green next year. “Starting with the mass production of its first electric SUV model at the Chennai plant at the end of 2024, the company plans to further produce five EV models by 2030. Hyundai Motor India will also utilize its sales network hubs, expanding the number of EV charging stations to 485 by 2030.”

Industry sources said that the first car to be locally electrified by Hyundai is likely to be the Creta SUV.

Kia India will also start production of its local EV model in 2025 and plans to further expand its EV models, while building charging infrastructure.

HMG will also localize the production of EV batteries as they account for a significant portion of an EV’s cost.

“Hyundai brought its expertise in producing compact cars and advanced technology. The favorable conditions of the Indian automobile market combined with Hyundai’s technological strengths led to synergistic results,” Chung said.

He said that India holds “strategic importance” for the group. “Hyundai Motor India has been pivotal in driving the growth of the Hyundai Motor Group, having navigated through numerous challenges including the Covid-19 pandemic, global economic crises, and supply chain disruptions due to semiconductor shortages. We take pride in consistently securing the second-largest market share in this vibrant market.”

Also, he said India will be increasingly used for exports. “India is among the fastest-growing economies globally, and as this growth continues, the strategic importance of Hyundai India will only increase. By leveraging our strong reputation and competitive quality in India, we aim to expand exports to neighboring countries, making India the global export hub to boost our regional market competitiveness.”