India, South Korea Can Offer Competitive Alternative to China in EVs: Hyundai India CEO

India’s manufacturing cost advantages and South Korea’s technological expertise could offer a competitive alternative to China’s dominance in the global electric vehicle industry, according to Hyundai Motor India Managing Director and CEO Tarun Garg.

Speaking at the Autocar Professional EV Conclave 2026 in New Delhi, Garg said China’s dominance in electric vehicles is largely driven by competitive pricing, while India and South Korea have complementary strengths that could help them compete.

“Which country offers the closest in terms of cost? Probably India. Then, which country offers the closest in terms of technology, especially in the EV space, maybe Korea?” Garg said during a panel discussion on scaling India’s EV market.

He said combining South Korea’s technological capabilities with India’s manufacturing and supplier ecosystem could help Hyundai strengthen its competitiveness, particularly as manufacturers look to reduce dependence on China for critical EV components.

The strategy is becoming increasingly important as Hyundai prepares to introduce a mass-market electric SUV in India and expand local production of components, including power electronics and charging systems.

Localisation to Strengthen EV Competitiveness

Localisation is a key part of Hyundai’s strategy to strengthen its EV business and reduce dependence on imported components.

Garg said Hyundai had already localised battery packs and was preparing to have domestically produced power electronics and integrated charging control units (ICCUs) ready ahead of its upcoming electric vehicle launch.

However, battery cell localisation has taken longer than initially planned, despite the company’s efforts and investments.

The upcoming compact electric SUV will initially use battery cells supplied by China’s Svolt before Hyundai moves to locally produced cells from Exide Industries. Garg had earlier said that the company had secured alternative supplies to avoid delaying the vehicle programme after Exide’s cell production timeline slipped.

Hyundai is also working to increase localisation across its wider vehicle portfolio. Speaking at the Bayon launch on October 26, Garg said the company currently sources approximately 83% of its components locally at the Tier-1 supplier level and aims to increase this to 92% by 2032. This broader target is separate from the localisation level of its electric vehicles.

Garg said Hyundai intends to deepen localisation beyond the first tier of suppliers, although raw materials and certain critical components will remain challenging to source domestically.

Hyundai Confident of EV Supply Chain Readiness

Despite the challenges, Garg expressed confidence in Hyundai’s ability to meet demand for its upcoming mass-market electric SUV, citing the global manufacturing and sourcing capabilities of Hyundai Motor Group.

He said Hyundai benefits from globally sourced components that provide economies of scale, while increasing localisation would help improve domestic supply availability.

“So many things are globally sourced, and that gives us scale. So that’s a huge advantage,” he said, referring to Hyundai Motor Group’s global supply network.

Garg distinguished between shortages of finished components, which could be addressed through localisation and production planning, and raw material availability, which could remain a challenge for the wider industry.

“I am pretty confident about managing the supply chain,” he said.

The company is preparing to introduce its first India-focused mass-market compact electric SUV, which is expected to compete in a segment currently served by products from Tata Motors, Mahindra and other manufacturers.

According to Hyundai’s August 2026 CEO Investor Day announcement, the new electric SUV will be designed and localised for India, featuring a next-generation infotainment system and Level 2 driver assistance technology.

Garg expects the upcoming model to increase Hyundai’s EV penetration and bring the company’s electric vehicle sales mix closer to the industry average.

“We are being more aggressive. We believe that the new car, the kind of product which we are going to launch will really bring us much, much closer to the industry averages of EVs,” he said.

The planned expansion comes as India’s electric passenger vehicle market continues to grow. According to the Federation of Automobile Dealers Associations (FADA), EVs accounted for 8.45% of passenger vehicle retail sales in September 2026, compared with 5.74% a year earlier. Electric passenger vehicle retail sales nearly doubled to 36,108 units during the month.

Rising Costs Could Challenge EV Affordability

While expressing confidence in EV demand and Hyundai’s supply readiness, Garg warned that rising raw material costs and uncertainty over government incentives could put pressure on vehicle prices.

“My worry also is that what will happen if the raw material prices continue to go up,” he said.

Garg also raised concerns about the potential impact of production-linked incentives being discontinued, questioning how automakers would maintain competitive prices without such support.

“Say PLI stops in March 28. What would that do to the pricing of the EV cars?” he said.

According to the Ministry of Heavy Industries, the automotive PLI scheme provides incentives for eligible sales through FY2026-27, with disbursements continuing into FY2027-28. The programme is intended to support domestic manufacturing of advanced automotive technology vehicles and components, rather than provide direct purchase subsidies to consumers.

Garg’s concern highlights the challenge facing automakers as they seek to expand EV adoption while absorbing higher input costs and increasing domestic manufacturing.

EV Buyers Moving Beyond Range and Running Costs

Garg believes consumer preferences will change as the electric passenger vehicle market matures, with design, driving experience and technology becoming increasingly important purchase considerations.

He compared the shift with the evolution of India’s conventional passenger vehicle market, where customers initially focused on spare parts availability, vehicle prices and fuel efficiency before placing greater emphasis on design, performance, technology and connectivity.

According to Garg, range and other basic EV attributes will increasingly become standard expectations rather than major points of differentiation.

He said the entry of more manufacturers and electric models could accelerate this shift and create additional demand.

“Customers have clearly moved from charging anxiety or range anxiety to the reliability of the charging infrastructure,” Garg said.

He cited Hyundai’s network of 186 DC fast-charging stations and the myHyundai application, which he said provides access to approximately 38,000 charging points across India.

The application is available to EV owners across brands, an approach Garg said was important for developing the wider market rather than restricting charging access to individual manufacturers.

He stressed that automakers would need to work together to strengthen public charging access rather than focus exclusively on their own customers.

India to Play a Larger Manufacturing and Export Role

Beyond the domestic EV market, Garg said India’s combination of competitive production costs, manufacturing quality and relative geopolitical stability was strengthening its position as a global manufacturing and export hub.

He said exports accounted for approximately 25% of Hyundai India’s production last year, compared with around 20% five years earlier. The company plans to increase this proportion to 30%.

Hyundai India recently crossed four million cumulative passenger vehicle exports, a milestone announced alongside the inauguration of its Pune manufacturing plant earlier this month.

The company’s export ambitions are supported by Hyundai Motor Group’s $15.5 billion investment plan for India between 2026 and 2032. According to the company’s official announcement, the investment covers manufacturing expansion, research and development, local supplier development and future mobility technologies.

Garg said trade agreements could help Hyundai India expand beyond its existing export markets and enter developed regions such as Europe and Australia.

He added that India’s ability to combine competitive costs with internationally benchmarked quality could strengthen its position in Hyundai’s global manufacturing network.

“In addition to the cost, India also gives a quality which is matching, you know, any global benchmark,” he said.

He said Hyundai already has the brand recognition, manufacturing capacity and international distribution network needed to expand exports, giving it an advantage as India becomes a larger part of the group’s global production strategy.