Hyundai Motor to invest $2.45B in India by 2032 to boost EV ecosystem
Hyundai Motor has announced that it plans to invest $2.45 billion (200 billion Indian rupees) over the next 10 years in the southern Indian state of Tamil Nadu to bolster its plans for electric vehicles in the country.
On Thursday, the South Korean company signed an agreement (a memorandum of understanding) with the state government of Tamil Nadu detailing its investment. It will lead to an increased production capacity at the company's facility in Sriperumbudur — Chennai's automotive corridor.
Hyundai Motor India, the company's India subsidiary, will also assemble EV battery packs and install 100 charging stations for EVs. Those charging stations will be a combination of dual ultra-fast and single faster-charging stations and they will be installed across the state over the next five years.
"The long-term investment will help enhance our manufacturing capability and also increase the production volume at our plant in Sriperumbudur, enabling us to make the best electric and ICE [Internal Combustion Engine] vehicles in Tamil Nadu for the rest of the world," Hyundai Motor India managing director Unsoo Kim said at a press conference.
The carmaker currently has a capacity of 775,000 vehicles per year at its Chennai factory that it plans to increase to 850,000. However, the exact timeline for the expansion is yet to be disclosed.
Almost 6% of all the EV vehicles manufactured in India are sold in Tamil Nadu, the state government's industries minister TRB Raja said at the conference. He added that 35% of country's the automobile industry is based in the southern state.
Tamil Nadu's Chennai, which is also called the Detroit of India, is a hub for automobile companies. It includes manufacturing facilities of various four- and two-wheeler makers including Renault-Nissan, Mitsubishi Motors, Yamaha and Royal Enfield — among others. The city also has showrooms for luxury car companies including BMW and Mercedes-Benz.
Hyundai's investment announcement comes just a day after China's MG Motor announced its plans to dilute existing Chinese shareholding by selling shares and invest over $611 million to set up a second plant in India, the world's third-largest car market. MG Motor also recently introduced its affordable EV called MG Comet in the country to attract young commuters.
Currently, India is an emerging EV market, with a handful of companies offering their electric cars. The country's EVs cumulatively make merely 1% of its total four-wheeler sales. However, the Indian government is pushing to expand EV adoption by incentivizing automobile companies and subsidizing consumers.