This undated file photo provided by Hyundai Motor shows the carmaker’s assembly plant in the southern state of Tamil Nadu.
SEOUL, May 12 (Korea Bizwire) — Hyundai Motor Co. is set to carve a dominant niche in the thriving Indian auto market.
The automaker announced on Thursday that it had signed a memorandum of understanding (MOU) with the Tamil Nadu State Government to inject 200 billion rupees (US$2.43 billion) into the country’s economy over the next ten years, commencing this year.
Chennai, the capital city of Tamil Nadu, is home to Hyundai’s first and second plants. Presently, the plants have an annual production capacity of approximately 760,000 units, of which around 150,000 units are exported.
Under the MOU, Hyundai aims to expand its existing infrastructure, build a comprehensive electric vehicle (EV) ecosystem, modernize production facilities, and invest in innovative technology.
Hyundai plans to construct a cutting-edge EV battery pack assembly plant that can produce up to 178,000 units annually.
Additionally, the company plans to establish 100 EV charging stations, including ones on highways, in Tamil Nadu in the next five years.
By 2028, Hyundai aims to introduce six EV models, including the Ioniq 5, to capture a more extensive market share.
This file photo offered by Hyundai Motor shows its headquarters building in India.
Moreover, the company plans to increase the annual production capacity of its Chennai plant to 850,000 units, alongside exploring the possibility of acquiring a foreign automaker in the country for the first time since entering the Indian market in 1996.
Recently, Hyundai Motor India signed a legally binding term sheet for the acquisition of General Motor Co.’s Talegaon plant in Maharashtra, which has an annual production capacity of 130,000 cars and 160,000 engines, according to Indian media outlet Autocar Professional.
With the acquisition of the GM plant and the investment in the Chennai plant, Hyundai’s local production capacity in India is expected to soar to around one million units.
Hyundai’s ambitious investment in the Indian market is primarily driven by the country’s strong growth prospects.
India has been experiencing an unprecedented increase in its automobile market, with domestic sales of 4.75 million units last year, making it the third-largest market in the world after China and the United States, and surpassing Japan.
This file photo provided by Hyundai Motor shows the all-electric IONIQ 5.
Furthermore, the Indian government’s active support of the EV market provides an ideal climate for Hyundai’s ambitious expansion plans.
The government aims to boost the share of EVs to 30 percent of total vehicle sales by 2030 by investing in EV infrastructure.
Recently, the government also announced an increase in tariffs on imported vehicles, including EVs, to promote local production and investment.
Currently, Hyundai ranks second in the Indian market after Maruti Suzuki India Ltd., with a market share in the mid-to-high 10 percent range.
Last year, the company sold 552,511 units in the Indian market, marking an impressive 9.4 percent growth from the previous year.
With its bold investment plans, Hyundai is poised to capture a more substantial market share in the fast-growing Indian automobile market.
Kevin Lee (kevinlee@koreabizwire.com)
