Hyundai to enter core EV market in India in 18 months
With a kitty worth Rs 20,000 crore for capex, the South Korean automajor has earmarked a sizable chunk for electric vehicles, as it prepares to enter the mainstream EV market in FY25.
South Korean car maker Hyundai Motor India tested EV potential in India with an imported Kona EV SUV in 2019. Four years later, the carmaker is all set to go mainstream in 2024-25.
With a top-down approach, the car maker has used the interim period in understanding the Indian market and their specific needs before deciding to take a plunge in the mainstream market, with a big focus on localisation.
'The EV market in India has moved much faster and there are other people who have already taken a lead, we have to catch up': Tarun Garg, COO, Hyundai Motor India
Declining to share the specifics, Tarun Garg, COO of Hyundai Motor India confirmed to Autocar Professional that the first mainstream EV model from the company is expected to hit the road within two years, "We have already announced that we will have more EVs. The big step has been taken, we have tested the market, we are feeling much more confident. The EV market in India has moved much faster and there are other people who have already taken a lead, we have to catch up," added Garg.
Sources say an EV on the Creta platform is scheduled for the start of production in December of 2024 and is likely to hit the roads by January 2025. The model will come around the same time as market leader Maruti Suzuki's EV alternative codenamed YY8, which was showcased at 2023 Auto Expo. "We have already committed Rs 20,000 crore investment. We have to drive mass adoption of EVs and that will be possible only through local manufacturing and sourcing. The investment will go towards new model expansion, localisation of battery packs, new capacity etc. Once battery packs are localised, it will bring the costs down," added Garg.
BEVs priority, but not ruling out Hybrids
On the future powertrain strategy, Garg says the first thing is capability and the second thing is execution. The product strategy of Hyundai India is linked to government policies. He said Hyundai Motor Group has all the technologies right from petrol, diesel, CNG, hybrids, flex-fuel, fuel-cell and EVs. As for India, "It is very clear that the Indian government supports BEVs with 5 percent GST as against 43-45 percent for hybrids, so we have decided to focus on BEVs." When asked if the company has ruled out hybrids. Garg said, "The policies are very much tuned towards EVs, at the same time, we are not ruling out hybrids. If we feel the market is there, policies are there, we may look at it. The door is not closed for hybrids, but it is not part of the current plan.“
Exploring more ICE options
Having expanded the pie with the entry SUV Exter, Hyundai Motor India has been able to expand its monthly domestic volumes by 6,000 to 7,000 units. And the company continues to explore more new models.
Garg says, given the structure of the Indian market, the newer white spaces will always emerge. But it is important to get the right product at the right time.
“We are looking at white spaces, we have to ensure that the product comes with the right features, right price and at the right time. Apart from new segments, we continue to look at keeping our products fresh. This year, we had almost half a dozen new product interventions right from the all-new Verna, Exter to refreshes on models like i20, Nios and Aura. And there are limited edition variants being added to Venue and Creta already. Recently we also introduced the ADAS feature in Venue,” he added. And much like the fast-changing requirement of the Indian market, the South Korean car maker is democratising key features like sunroof, ADAS and even six airbags to its portfolio to sustain the aspirational quotient with the brand.
Indian market to outperform
“At HMI, we look beyond just numbers and market share, we keep an eye on how the brand is moving. As a prominent player, we try to keep our products modern and updated to meet the needs of the new age India. We have always tried to raise the benchmark with features like Blue link, sunroof, Bose stereo system, ADAS, and we will continue to raise the bar in the future as well,” added Garg. The COO of Hyundai Motor claimed that with high GDP growth, India has remained an outlier amongst the major world economies and the Indian market will continue to grow faster. “The stock market is at an all-time high, market sentiment is positive. There is a rain deficit, yes, but it is hopefully recovering well in September. Economy is looking good and there is positivity around India post G20. Yes, there are challenges, but we are confident of the mid-term to long term India growth story. In the next three to five years, the industry should grow faster than the last decade,” asserted Garg.
This article was first published in Autocar Professional's October 1, 2023 issue.
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