UPDATE 2-South Korea's Hyundai to invest $2.45 bln in Indian state

Reuters · 05/11/2023 02:30
UPDATE 2-South Korea's Hyundai to invest $2.45 bln in Indian state

Adds background on Hyundai, Indian EV market

By Praveen Paramasivam

- South Korea's Hyundai Motor Co 005380.KS said on Thursday it will invest 200 billion rupees ($2.45 billion) in the southern Indian state of Tamil Nadu over the 10 years, to beef up electric vehicle production in the world's most populous country.

Tamil Nadu is a hub for automobile manufacturing with the likes of Ashok Leyland ASOK.NS, TVS Motor TVSM.NS, Hyundai and Renault-Nissan making thousands of two- and four-wheelers every year.

Hyundai, through its Indian subsidiary Hyundai Motor India, will also set up a battery pack assembly unit with an annual capacity of 178,000 units and install 100 EV charging stations across the state in the five years, it said in a statement.

The carmaker's move comes a few weeks after the federal government said it would raise taxes on imported cars and motorbikes, including electric vehicles (EVs), as it seeks to boost local manufacturing.

India's EV industry has grown rapidly, with domestic carmakers Tata Motors TAMO.NS and Mahindra & Mahindra MAHM.NS as well as global rivals BYD 002594.SZ and SAIC's 600104.SS MG Motor lining up launches.

However, the market is still small, accounting for roughly 1% of the total car sales in the country in 2022. The federal government aims to push that to 30% by 2030 as it looks to reduce pollution and fuel imports.

As of April, Hyundai had a 15% market share in India's passenger vehicle space, only behind Maruti Suzuki.

Hyundai rivals Nissan Motor 7201.T and Renault SA RENA.PA in February said they would invest $600 million to fund the development of two electric models and four sport-utility vehicles (SUVs) for sale in India and abroad.

($1 = 81.7800 Indian rupees)

(Reporting by Praveen Paramasivam in Chennai; Editing by Janane Venkatraman)

((chris.thomas@thomsonreuters.com; +91 80 6210 0487;))