EVs will account for 22% of sales by 2030: Hyundai COO Tarun Garg

Tarun Garg, COO, Hyundai Motor India

Hyundai Motor India expects FY26 to serve as an inflection point for sales of electric vehicles in the country, chief operating officer Tarun Garg said.

Hyundai clocked a record 600,000 domestic sales figure in 2023 – the highest in its history and a 9 percent increase from the previous year. Garg said HMI’s share of rural sales increased to 19 percent in 2023 from 18.3 percent earlier even as prices rose and the entry-level car market shrank.

SUVs now account for 60 percent of the company’s sales and its market share in the SUV segment widened to 18 percent after the introduction of the Exter compact SUV.

“People want to move towards SUVs. Young customers are more aspirational, so we expect significant growth in the SUV segment,” Garg told reporters, adding that its SUV segment grew by 7 percent.

Even the Hyundai Creta, which has a facelifted version due for launch in the first quarter of 2024, posted strong sales in December, according to Garg, with a pending order bank of 23,000 units. In total, HMI has a backlog of 90,000 bookings, which it aims to clear on a war footing.

Also Read: The Green Pivot: Booming EV sales are good for car companies but not so much for the climate

Minimal hybrids

SUVs accounted for about half of the over 4 million passenger cars sold in India in 2023. Hyundai Motor India, the country’s second-largest passenger vehicle maker, reported total sales at 765,786 units in 2023 on the back of record annual domestic sales.

Automatics, usually found in higher trims, grew 5 percent and now account for 22 percent of the company’s sales.

Asked about introducing new powertrains and technologies, Garg was reticent, stating that the company is prepared to offer a variety of powertrains, but hybrids will not be introduced until the policy is amenable. Although rival Maruti Suzuki reported strong sales of its hybrid Grand Vitara, Garg cited the example of the Honda Elevate to demonstrate that the hybrid presence in the market continues to be minimal.

“There’s no point in introducing a technology if you cannot bring volumes. At the current tax structure, it isn’t feasible to introduce hybrids,” Garg said.

However, when it comes to EV sales, Garg isn’t focussing on volumes – at least, not yet. While Hyundai has lined up launches of the Exter EV, the Kona EV and the Creta EV, Garg remained emphatic about volumes not being a consideration.

The Exter EV and the Venue EV, both targeted for launch in the near future, will represent the lower-end of Hyundai’s EV portfolio.

“We’re taking significant steps towards bringing costs down. We’ve made a significant investment of Rs 20,000 crore to introduce new models and more importantly, bring about greater battery localisation,” he said.

Also Read: The Drive Report: 2023 BMW M340i

Speaking about its premium EV offering, the Ioniq 5, Garg said it surpassed the sales target of 500 units, with 1,100 units sold. Garg also said he sees turbo-petrol and CNG technology gaining more traction in the coming years. Garg stated that the EV market inflection point in 2025-2026, with EVs accounting for 22 percent of overall sales by 2030 only.

“We can look forward to more Hyundai EVs, but we will have a good balance of turbo-petrol and diesels, which will continue to go down and be limited to larger SUVs, CNG for models like the Aura, and of course EVs,” he said.

Asked about a price hike in January, Garg said the quantum will be low and will be announced soon. Garg emphasised that Hyundai is very particular about safety and has made six airbags standard across all models and variants.

Garg said Hyundai hasn’t yet enrolled any vehicles in the newly launched Bharat New Car Assessment Program for safety ratings, but will send three cars this year. Although he did not specify the models, reports suggest these models could include Exter, Creta and Tucson.

Given the high demand and sales backlog, Garg said HMI has increased its production capacity by 50,000 units at its Chennai plant and will now look at its recently acquired GM Motors plant in Talegaon Pune for further capacity expansion of 25,000 units in 2024.