Hyundai's India expansion: Can Korean carmaker challenge China's EV dominance?

Last week, South Korea's Hyundai Motor Co announced that it will invest 200 billion rupees (USD 2.45 billion) in Tamil Nadu over the next 10 years to bolster its electric vehicle (EV) production in India. SNE Research which provides global market research and consulting to the rechargeable batteries industry ranked Hyundai as the top sixth EV carmakers by sales in 2022. The Asian carmaker is ramping up its production capabilities as it aims to become one of the world's top three electric vehicle manufacturers by 2030.

| Updated on: 15 May 2023, 08:27 AM
Follow us on:
Follow us on:
Bollywood showman Shah Rukh Khan in his iconic pose in front of Hyundai's showstopper Ioniq 5 at the Auto Expo 2023.
Bollywood showman Shah Rukh Khan in his iconic pose in front of Hyundai's showstopper Ioniq 5 at the Auto Expo 2023.

The South Korean car manufacturer whose brands include Hyundai, Kia and Genesis delivered 510,000 EV units last year, an increase of 40.9 per cent from 2021, according to SNE Research. First place went to China's BYD, which delivered 1.87 million units, followed by Tesla with 1.31 million units. Germany's Volkswagen and China's Geely took fourth and fifth places, respectively.

CEO Jaehoon Chang told CNBC, "We are now developing two more platforms and that will enable us to have 18 models by 2030. And we are (aiming) to achieve 2 million EV sales around 2030."

Also check these Cars

Find more Cars
Hyundai Ioniq 5 (HT Auto photo)
₹44.95 Lakhs**Ex-showroom price
Add to compare
Check latest offers
It's Quiz Time ! Can you guess the Car Logos?
Bmw 2 Series Gran Coupe (HT Auto photo)
₹37.9 - 42.3 Lakhs**Ex-showroom price
Add to compare
Check latest offers
Mini Cooper (HT Auto photo)
₹38 Lakhs**Ex-showroom price
Add to compare
Check latest offers
Audi New A3 (HT Auto photo)
₹39 - 45 Lakhs* *Expected Price
View Details
Toyota Camry (HT Auto photo)
₹39.41 - 41.2 Lakhs**Ex-showroom price
Add to compare
Check latest offers
Mercedes-benz A-class Limousine (HT Auto photo)
₹39.9 - 43.2 Lakhs**Ex-showroom price
Add to compare
Check latest offers

The carmaker is investing heavily in research and development, building new plants and platforms as well as expanding EV lines and production capacity.

"We are now developing two more platforms and that will enable us to have 18 models by 2030. And we are (aiming) to achieve 2 million (annual) EV sales around 2030," Hyundai CEO Chang said.

Its EVs are currently developed on an advanced bespoke EV platform, the Hyundai Electric Global Modular Platform (E-GMP). The 2021 Ioniq 5 crossover SUV was the first model in Hyundai's EV-focused sub-brand Ioniq to be developed on the E-GMP. Hyundai subsequently launched the Ioniq 6 sedan model in 2022. An EV platform scales the production of future models and reduces development and manufacturing costs.

Hyundai plans to introduce vehicles in 2025 based on its two new EV platforms, eM and eS, which are expected to lead to more efficient vehicle development and greater cost reductions.

Away from the limelight, Hyundai has gradually slipped into third place in 2022 in the global race to become the largest global automaker. Based on industry data compiled by CNBC, Hyundai and Kia sold a total of 6.85 million vehicles globally last year, up 2.7 per cent from a year ago. Top dog Toyota sold nearly 10.5 million units while European auto giant, Volkswagen sold about 8.26 million units.

Hyundai reported a 92 per cent year-on-year increase in net profit for the first quarter of 2023, "mainly driven by the US and Europe," said Chang.

Hyundai reported a net profit of 3.42 trillion won (USD 2.56 billion), up from 1.78 trillion won in the same period a year ago. Revenue grew 24.7 per cent year-on-year, from 30.3 trillion won to 37.78 trillion won.

Hyundai aspires to make an impact in China's automotive market but the company's exposure is very limited at the moment.

"We have a joint venture in China. We are now on a deep dive into how we can regain the competitiveness of the China market," said CEO Chang. China's EV sales are expected to hit more than 8 million units in 2023, according to Counterpoint Research.

"I think the first step that we're looking at is how we can optimise the operational capacity in China. And the next step should be our focus on the product portfolio, which should be attractive to local customers with the comparable software functions, as well as hardware and design features," said Chang in the CNBC interview.

In 2022, China produced almost two-thirds of all global battery EVs and one in four cars sold in China is an EV. In China, more than 94 brands together offer over 300 models selling for just USD 5,000 to over USD 90,000. Local brands command 81 per cent of the EV market, among which BYD, Wuling, Chery, Changan and GAC are a few of the top players.

In a distant second place is Europe followed more closely by North America, accounting for 17 per cent and 11 per cent of global EVs built in 2022, respectively.

For now, it looks like China has taken an insurmountable lead in the race to be the leading EV manufacturer of electric vehicles. However, it's early days yet with just nine per cent of all light vehicles made last year an EV, there is plenty of room for the other markets to catch up.

Government support has a large part to play in the position China is in today. Between 2009 and 2022, China handed out more than CNY300 billion (USD 43.5 billion) in purchasing subsidies and tax breaks to support locally produced EVs, both domestic and foreign-owned brands. The government also offered large procurement contracts to buy products from budding EV companies, which helped them in their early years and fund further R&D.

In Tamil Nadu's Chennai, dubbed the Detroit of Asia, Hyundai plans to increase capacity at its factory near Chennai to 850,000 vehicles per year from approximately 775,000. In addition, the automaker's Indian subsidiary, Hyundai Motor India, will establish a battery pack assembly unit with an annual capacity of 178,000 units and install 100 EV charging stations across the southern state in the next five years.

The investment plan follows the union government's recent announcement that it will raise taxes on imported vehicles to encourage local manufacturing.

In Singapore, Hyundai earlier this year said that its Singapore assembly plant in Jurong will start rolling out the electric Ioniq 5 by the middle of this year following a delay partly due to the COVID-19 pandemic. It was originally slated to be completed last November.

Andy Kang, Hyundai Motor's head of sales innovation group said that the plant will initially import the car's fully painted body shell from its newly opened factory in Indonesia, with all other parts shipped in from South Korea. It plans to gradually source parts locally once production volume ramps up.

Besides the Ioniq 5, the newly unveiled Ioniq 6 and new Kona Electric will be assembled in the Jurong facility too. The plant is slated to produce up to 30,000 vehicles a year by 2025.

"We aim to become the number one EV brand in Singapore," Kang said. That position is currently held by Tesla. (ANI)

First Published Date: 15 May 2023, 08:27 AM IST
Recommended for you
View all
Shopping Bag Shop Now
55% OFF
SOFTSPUN Microfiber Cloth - 4 pcs - 40x40 cms - 340 GSM Grey- Thick Lint & Streak-Free Multipurpose Cloths - Automotive Microfibre Towels for Car Bike Cleaning Polishing Washing & Detailing…
Rs. 269 Rs. 604
19% OFF
Involve Your Senses One Musk Organic Car Perfume, Involve Your Senses Strong Fiber Air Freshener to Freshen'up Your Car - IONE01-40 g,Car Accessories interior car perfumes and fresheners
Rs. 324 Rs. 399
73% OFF
pTron Bullet Pro 36W PD Quick Charger, 3 Port Fast Car Charger Adapter - Compatible with All Smartphones & Tablets (Black)
Rs. 349 Rs. 1,299
9% OFF
ShineXPro Microfiber Car Cleaning Cloth - OG Soft 500 GSM Extra Large (35x75 CM) Microfiber Cloth for Car and Bike - Suede Edging for Scratchless Drying and Detailing (Pack of 2)
Rs. 498 Rs. 549

Please provide your details to get Personalized Offers on

Choose city
+91 | Choose city
Choose city
Choose city
By clicking "View Offers" you Agree to our Terms and Privacy Policy

Dear Name

Please verify your mobile number.

+91 | Choose city