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Traditionally, Hyundai has competed closely with Tata Motors for the number two spot. However, Mahindra, known for its robust sport utility vehicles (SUVs), has been steadily gaining ground as Indian consumers show a growing preference for larger passenger vehicles read more
 "Hyundai looks to spend $2.4 billion in developing EVs for India as it eyes $3.5 billion IPO")
The investment agreement with Maharashtra state was confirmed during the World Economic Forum summit in Davos. Image Credit: Reuters
Hyundai looks to disrupt the Indian auto sector, as well as the stock market as it eyes what experts are calling the biggest IPO India has ever seen. Hyundai has been planning an IPO in India for some time now and will be launching a $3.5 billion IPO bid soon. However, it won’t be smooth sailing for the South Korean automotive giant.
Tata Motors and Mahindra & Mahindra are making significant strides in the Indian automotive market, closing in on Hyundai Motor Co.’s position as the second-largest automaker in the country. This competition intensifies as Hyundai prepares for a monumental $3.5 billion listing of its local unit.
Traditionally, Hyundai has competed closely with Tata Motors for the number two spot. However, Mahindra, known for its robust sport utility vehicles (SUVs), has been steadily gaining ground as Indian consumers show a growing preference for larger passenger vehicles.
Recent data from the Federation of Automobile Dealers Associations shows Hyundai held a 13.5 per cent share of passenger car sales in India last month, while Tata Motors closely followed with 13.2 per cent, and Mahindra at 12.4 per cent. Maruti Suzuki Ltd. remains the king of the hill with a grip of over 40 per cent share of the market.
This competitive landscape emerges just as Hyundai Motor India Ltd. gears up for an initial public offering (IPO) expected in September or October, potentially marking one of Asia’s largest IPOs in recent years.
During a recent investor presentation, Hyundai India CEO Unsoo Kim highlighted the company’s leading positions in various categories. However, Chief Operating Officer Tarun Garg acknowledged the challenges posed by the Indian market, which has seen many foreign automakers exit.
To strengthen its position, Hyundai is investing around $2.4 billion in developing electric vehicles (EVs), an emerging sector in India. Additionally, it plans to spend 70 billion rupees to operationalize its second plant by late 2025. As part of its green initiative, Hyundai will launch an electric version of its popular mid-sized SUV, the Creta, in early 2025.
Meanwhile, Tata Motors is expanding its EV lineup with plans to introduce 10 new models by fiscal 2026. Mahindra is set to invest 270 billion rupees over the next three years to boost its capacity for manufacturing both SUVs and EVs.
The company aims to release nine diesel and gas-powered SUVs and seven EVs by 2030. Notably, Maruti Suzuki, despite leading the market, currently does not offer any battery-powered vehicles.
Deven Choksey, managing director at KR Choksey Shares & Securities Pvt, attributed any potential loss in Hyundai’s market share to its product range. He also noted that Tata Motors and Mahindra, cut-throat competitive pricing and stunning design are mounting a rather formidable, but interesting challenge to all carmakers in India, which also brings a lot of opportunities.
In January 2024, Hyundai Motors also announced plans to invest $845 million to ready its second plant in India, acquired from General Motors, which had left the facility idle for years.
The investment agreement with Maharashtra state was confirmed during the World Economic Forum summit in Davos. Hyundai plans to make phased investments to upgrade the existing infrastructure and manufacturing equipment at the Talegaon plant, positioning itself for continued growth in the Indian market.
(With inputs from agencies)
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English (US) ·