Hyundai Motor lines up $200 million for electric vehicle mass market

The Korean automobile company recently launched an electric car named Kona in India

Days after launching India’s first long-range green SUV Kona, Hyundai Motor said it is planning to develop a new electric vehicle (EV) platform for the country with a $200-million investment to tap the mass market.

“We are working on a (electric) platform, which would be for the Indian mass market and cost around $200 million,” said S S Kim, MD and CEO of Hyundai Motor India. He said the product may be launched in three-four years. 

With Kona catering for the high-end market, the South Korean automobile conglomerate wants to introduce a product in the EV segment to address the mass segment. The company has received around 120 bookings in 15 days for Kona, including 33 from Bengaluru and 20 from Chennai. 

Kim stressed the need for more localisation to develop the EV platform. “Currently, localisation is too low since suppliers have not geared up but as volume grows, it will evolve,” he said. He, however, declined to reveal the price point the new product would target. 

Early this year, Hyundai signed an MoU with Tamil Nadu to invest ~7,000 crore for developing new products and expanding capacity through brownfield expansion in the state. 

In March 2019, Hyundai and its affiliate Kia Motors announced an investment of $300 million (around ~2,068 crore) in Ola. 

According to the agreement, the three companies would collaborate on building India-specific EVs and infrastructure, and developing unique fleet and mobility solutions. The partnership would offer Ola drivers various financial services, including lease and instalment payments, while vehicle maintenance and repair services would enhance customer satisfaction, Hyundai Motor then said. 

Hyundai, Kia and Ola also agreed to coordinate efforts to develop cars and specifications that reflect the needs of the ride-hailing market. 

On whether Hyundai would look at hybrid vehicles, Kim said the company has the technology and would consider the option if the government gave incentives. 

The company’s plant in the state is said to be running at nearly full capacity, mostly due to the growing SUV demand. The monthly production of SUVs has gone up from around 9,000 to nearly 17,000. 

Kim appeared optimistic about the future of Hyundai and the Indian passenger car industry, which he said would be driven by rural demand for the next few years.