No plans for hybrid cars in India as BEVs are 'ultimate destination', says Hyundai Motor India COO

By early 2025, Hyundai will start rolling out its high-on-volumes EV models across various price points, Tarun Garg said

Riding the bandwagon of carmakers such as Tata Motors, Mahindra and Mahindra (M&M), Kia India, and MG Motor India, among others, Hyundai Motor India Limited (HMIL) has categorically asserted that it has no plans to build hybrid electric vehicles (HEVs) in the country.  A senior company official, while talking to reporters, maintained that battery electric vehicles (BEVs) are the “ultimate destination” for the Indian automotive industry.

“We have hybrid technology, and cars based on that are doing very well in the US and Europe as far as Hyundai is concerned. But in India, if you see the tax structure, the government’s narrative, it is very clearly towards EVs,” Tarun Garg, Chief Operating Officer (COO), HMIL, said.

He went on to add, “If you see most of the local (car) manufacturers, they are investing in EVs. If you see Hyundai, we have launched the Kona EV in 2019 and the Ioniq EV in 2023, and now we are investing in localisation of battery packs.”

It may be recalled that in 2023, the South Korean carmaker had earmarked Rs 700 crore for the battery pack manufacturing plant in Chennai, which is touted to have an annual production capacity of 75,000 units. The company is also aiming to have 20 percent EV penetration across its lineup by 2030.

“For India, EVs appear to be the ultimate destination because the country wants to reduce oil (consumption). This will only happen through EVs and not through hybrid (vehicles), which have the advantage of only fuel efficiency. So in our view, it appears BEV is the way (forward) and that is where Hyundai is also investing," Garg further added.

On whether there will be an electric variant of the Creta, Garg refused to comment but maintained, “We have already commenced the battery localisation process at our Chennai facility that will enable us to cut down the prices of EVs and bring in more models. By early 2025, we will start rolling out our high-on-volumes EV models across various price points.”

On January 16, the company strengthened its sports utility vehicle (SUV) portfolio with the introduction of the facelifted Creta, priced between Rs 10.99 lakh and Rs 19.99 lakh (ex-showroom). Nearly 25,000 units of the model have been booked to date.

“While 55 percent of our sales are derived from petrol-driven models, we expect the share to go up to 60 percent in the future. The remaining 40 percent of sales will still be coming from diesel versions,” noted Garg.
According to him, while the top 10 metro cities contribute sizably to Creta’s sales, there are some untapped growth opportunities also coming from Tier 2 and Tier 3 cities.

“The SUV contribution from the rural market is very similar to the rural market. While the SUV contribution (to our sales) is 60 percent, the urban-rural gap is only 2-3 percent. As roads and highways are getting better, the accessibility of Tier 2 and Tier 3 cities is very strong now. Also, people in rural markets want SUVs now,” noted Garg.

Meanwhile, Garg revealed that HMIL expects SUV sales to account for 65 percent of its overall volumes in 2024. The company currently gets around 60 percent of its overall volume from SUVs.

HMIL will also be investing Rs 7,000 crore on its second plant at Talegaon in Maharashtra. While Garg didn’t disclose the investment figures, he revealed that the company will start production at the acquired facility next year.