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Hyundai Motor India’s EV Push: Creta EV And Three New Models Set For Launch by Year-End

Hyundai Motor India Ltd plans to launch four electric vehicle models, including the Creta EV, in the final quarter of the current fiscal year, as detailed in its initial IPO documents submitted to Sebi, emphasizing local production and market segmentation for EVs.

Edited By : Swechchha | Updated: Jun 17, 2024 21:01 IST
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Hyundai Motors to launch four electric vehicle models

Hyundai Motor India Ltd intends to introduce four electric vehicle models, including the Creta EV, in the final quarter of the current fiscal year, as outlined in the company’s initial IPO documents submitted to Sebi.

The company aims to enhance the price competitiveness of its electric vehicle (EV) lineup and plans to prioritize the establishment of local production capabilities for critical components like cells, battery packs, power electronics, and drivetrain. They are also focusing on developing a localized EV supply chain.

In its draft red herring prospectus (DRHP), Hyundai Motor India Ltd (HMIL) stated its intention to fine-tune its EV strategy and schedule EV launches according to market demands in India, aiming to introduce suitable EV models across various price segments.

“We are implementing a transition strategy, beginning with the introduction of high-end premium EVs, and intend to shift towards mass markets as the EV market and ecosystem expand in India. As part of this strategy, we plan to unveil four EV models, including the Creta EV, by the final quarter of fiscal 2025,” stated the company.

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Currently, HMIL offers two EV models in India — the IONIQ5 and Kona Electric — priced at approximately ₹45 lakh and ₹24 lakh, respectively. The company emphasized its strategy to enhance the price competitiveness of its EV lineup by concentrating on establishing local manufacturing capabilities for critical components like cells, battery packs, power electronics, and drivetrain, while also developing a localized EV supply chain.

HMIL has leased a portion of its Chennai Manufacturing Plant to Mobis, a Hyundai Motor Company (HMC) group firm, for the assembly of EV batteries. This strategic move aims to reduce import costs for battery packs by sourcing locally manufactured components.

“We also plan to localize the EV supply chain by partnering with local and global vendors of EV power electronics,” the statement read. It further noted that in 2024, HMC announced a strategic collaboration with Exide Energy Solutions Ltd to support localized battery production and supply in India.

Similarly, HMIL mentioned, “We are currently exploring various strategic collaborations for battery production. We anticipate that introducing domestically sourced EV models will diversify our passenger vehicle lineup and broaden our market presence.”

Additionally, in the short term, the company aims to enhance localisation efforts to qualify for production-linked incentive (PLI) subsidies and shift to a dedicated EV platform to streamline costs, it stated.

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In its DRHP, the company highlighted ‘uncertain policy changes’ as a potential threat to the automotive industry.

HMIL also cited frequent policy changes as a significant challenge for the industry, complicating adherence and investment commitments for auto industry stakeholders. The company emphasized the need for stable and transparent policies to facilitate smooth technology transitions and localization efforts in the country.

Additionally, the company highlighted concerns regarding meeting eligibility criteria and accessing benefits under localisation norms.

It stated that the government is promoting localization across sectors, particularly in automotive, through initiatives such as PLI for automotive technology and advanced cell chemistry, phased manufacturing programs, ‘Atmanirbhar Bharat,’ and Make in India.

“In its preliminary papers, HMIL emphasized that while the ultimate objective of localization is to diminish reliance on imports and lower manufacturing expenses, achieving this goal requires substantial initial capital investments from various stakeholders in the automotive industry.”

Last week, HMIL submitted preliminary papers to Sebi for an initial public offering (IPO). If successful, HMIL’s IPO would be India’s largest, surpassing LIC’s ₹21,000 crore share sale. The company plans to offer 14,21,94,700 equity shares with a face value of ₹10 each, representing 17.5% of the post-offer paid-up share capital.

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First published on: Jun 17, 2024 09:01 PM IST

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