Hyundai Motor Plans to Invest $2.45 bn in Tamil Nadu Over the Next 10 Years

Hyundai Motors Co announced on Thursday that it would invest about 200 billion rupees ($2.45 billion) in Tamil Nadu, India, over the next ten years to expand electric vehicle production capacity in India.

Leading automobile manufacturing companies like Ashok Leyland, TVS Motors, and Renault-Nissan are already churning millions of units yearly in Tamil Nadu’s Chennai.

Hyundai already has two manufacturing plants in the state —Irungattukottai and Sriperumbudur. Irungattukottai is the second largest facility of Hyundai located outside South Korea, producing 7,40,000 cars annually.

Hyundai Motor India, the Indian subsidiary of this Korean car maker, will establish a battery pack assembly unit with a yearly production capacity of 178,000 units. Further, the brand will install 100 EV charging stations across southern India in the next five years.

The company has plans to increase production volume at its manufacturing plant near Chennai. Hyundai will upgrade this plant to increase yearly production from roughly 7,75,000 to 8,50,000 units. However, this car maker hasn’t specified the timeline for this target in its official statement.

Hyundai said to increase its export volume from 1,81,000 in 2022 to 3,19,000 by 2032. This car maker announced its investment plan after the Indian government announced to increase taxes on imported vehicles to support local manufacturing.

Puneet Anand, a senior executive for corporate affairs, said that the company is also collaborating with a local vendor base for EV parts rather than importing them from other countries, as the government’s production incentive scheme is only available if the brand manufactures vehicles locally.

Moreover, Hyundai aims to launch about five new electric vehicles in the domestic market, targeting a 20% share of the EV market by 2032. Though India’s EV industry is rapidly growing, it still hardly amounts to 1% of its total car sales in 2022. The Indian government focuses on increasing the market share of electric cars by 30% by 2030.

Hyundai is a leading car maker that is only behind Maruti Suzuki India, which is a subsidiary of Japanese car maker Maruti Suzuki. The company has about 15% market share, with some of its best-selling cars like the Hyundai Creta and Venue.