The South Korean automaker disclosed progress in its domestic manufacturing operations, with 197 Tier 1 vendors now serving its Chennai and Pune facilities under the Atmanirbhar Bharat framework.
15 Oct 2025 | 3962 Views | By Angitha Suresh
Hyundai Motor India showcased its deepening commitment to the "Atmanirbhar Bharat" initiative at its investor day presentation today, revealing impressive strides in supply chain localization across its manufacturing facilities in Chennai and Pune.
The Korean automaker has achieved a remarkable 82% localization rate for its photovoltaic operations in India, ...
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Hyundai Motor India showcased its deepening commitment to the "Atmanirbhar Bharat" initiative at its investor day presentation today, revealing impressive strides in supply chain localization across its manufacturing facilities in Chennai and Pune.
The Korean automaker has achieved a remarkable 82% localization rate for its photovoltaic operations in India, with over 1,200 parts now being sourced locally. The company has onboarded more than 50 new Tier 1 vendors and localized 8 parts for the first time in India among its PV lineup, demonstrating its commitment to building a self-reliant manufacturing ecosystem.
Building an Integrated Supplier Ecosystem
Hyundai's localization strategy centers on creating robust supplier clusters around its manufacturing hubs, significantly reducing logistics costs and improving supply chain efficiency. This approach has transformed the company's operational dynamics, particularly at its flagship Chennai facility.
The Chennai plant has emerged as the cornerstone of Hyundai's Indian operations, with 60% of vendor partners located in or around the factory. The integrated supplier ecosystem comprises 197 Tier 1 vendors, with an impressive 85% rated at 4-star level or above, alongside 1,058 Tier 2 vendors, of which 82% are SQ certified.
The proximity advantage is substantial, with 93% of parts available within a 4-hour delivery radius. This clustering enables Hyundai to operate on a just-in-time supply model while maintaining stringent quality standards through direct Tier-2 engagement.
The newly established Pune facility represents Hyundai's future-ready manufacturing base, with 45% vendor clustering already established around the factory.
The greenfield plant has brought 21 new Tier 1 vendors into Hyundai's ecosystem while leveraging 120 common vendors to create strategic advantages through shared supplier relationships. This expansion has generated over 4,500 new jobs across the vendor ecosystem and attracted more than ₹4,500 crore in vendor investment.
Strategic Impact and Economic Contribution
Hyundai's localization efforts have generated substantial economic impact, with the Chennai operations alone delivering forex savings exceeding ₹5,300 crore since 2014. The company has also facilitated technology transfers and joint venture partnerships with over 10 vendor partners, creating 1,400 direct manufacturing and production jobs in the process.
Looking ahead, the company's "Localization 2.0 Strategy" focuses on high-technology parts and project stage localization enhancement. The approach emphasizes deeper collaboration through Tier 3 partnerships and enhanced joint venture frameworks, positioning Hyundai to tackle increasingly sophisticated manufacturing challenges.
The enhanced automation and digitalization at the Pune facility signals the company's commitment to building a technologically advanced manufacturing base capable of supporting India's evolving automotive landscape while simultaneously improving cost competitiveness and supply chain resilience.