Hyundai Motor Group chief pledges $15.5b investment in India after meeting Modi

Eighth meeting in New Delhi on Tuesday

Seven-year investment plan through 2032

Annual production capacity of 1.4 million vehicles

India positioned as strategic hub for emerging-market exports

Dedicated investment subsidiary to be established

Hyundai Motor Group Executive Chair Euisun Chung (left) meets Indian Prime Minister Narendra Modi at the prime minister's residence in New Delhi on Tuesday (local time) to discuss the group's investment plans and the development of India's automotive industry. [Hyundai Motor Group]

Hyundai Motor Group Executive Chair Euisun Chung met Indian Prime Minister Narendra Modi and outlined a $15.5 billion investment plan for the country. The group intends to expand local production facilities, scale up research and development, and invest in future mobility over the seven years through 2032, positioning India as a key hub not only for its domestic market but also for exports to emerging economies.

Chung held a one-on-one meeting with Modi at the prime minister's official residence in New Delhi on Tuesday (local time), where the two discussed the direction of India's automotive industry and the group's medium- to long-term business strategy, Hyundai Motor Group said Wednesday.

It was the eighth meeting between the two. Chung traveled to India in April as part of a business delegation accompanying the South Korean president on a state visit, and he also met separately with Modi when Hyundai Motor's Indian subsidiary listed on the local stock exchange in 2024. The two have also met at events including Modi's visit to South Korea in 2015 and a Korea-India business summit.

At the meeting, Chung thanked the Indian government for its support of the group's operations in the country. "Hyundai Motor Group has grown alongside India over the past 30 years since entering the market in 1996," he said. "India is a strategic country that will drive Hyundai Motor Group's future growth and expansion into emerging markets," he added, announcing plans to invest approximately $15.5 billion over the seven years starting this year.

Visitors look at vehicles on display at the Hyundai Motor exhibition booth at the Indonesia International Motor Show 2026 in Jakarta on Feb. 9. [Reuters]

The investment will extend well beyond vehicle factories. Funding will flow across the broader automotive industry — expanding production capacity, building out R&D facilities, strengthening the local parts supply chain and securing future technologies. The group also plans to establish a dedicated subsidiary in India to oversee group-level investment.

The push to expand in India is driven by the market's rapid growth. India is home to about 1.47 billion people, making it the world's most populous country, and it ranks as the third-largest automotive market after China and the United States.

India's passenger car market is expected to grow about 15 percent this year, from about 4.57 million vehicles last year to about 5.25 million. The OECD projected India's economic growth rate at 7.1 percent for this year last month, and the IMF, in its outlook released this month, forecast growth of around 7 percent for both this year and next year.

The Creta, Creta N Line and Exter on display on the first floor of Hyundai Motor's India regional headquarters in Gurugram. [The Korea Herald]

India's manufacturing promotion policies are another factor behind the production expansion. Since taking office in 2014, Modi has pursued the "Make in India" initiative, and the government has recently been accelerating efforts to develop manufacturing and future industries around a national vision of becoming a developed country by 2047.

Hyundai Motor Group already has the capacity to produce more than 1.4 million vehicles a year in India. Hyundai Motor's two Chennai plants can produce 824,000 vehicles annually, the Pune plant — which recently began operation — has a capacity of 170,000 units, and Kia's Anantapur plant can produce 431,000 units. Combined, the three plants have an annual capacity of about 1.425 million vehicles. The Pune plant is set to expand its capacity in stages going forward.

"With the Pune plant now operational, Hyundai Motor Group has secured an annual production system of 1.4 million vehicles," Chung said. "We will actively respond to the continued growth of India's automotive market through stable production and expand exports to emerging markets."

Hyundai Motor Group Executive Chair Euisun Chung speaks with employees at Hyundai Motor's Pune plant in India in January. [Hyundai Motor Group]

Hyundai Motor Group sold a combined 852,164 vehicles in India last year — 571,878 by Hyundai Motor and 280,286 by Kia. The two brands together held an 18.7 percent market share, placing second behind Maruti Suzuki.

Hyundai Motor began selling in India in 1998 when it started producing the Santro compact car at its Chennai plant. Through the third quarter of this year, cumulative sales have reached 9,884,960 vehicles, and industry watchers expect the automaker to surpass the 10 million mark before the end of the year.

Growing uncertainty in global automotive markets has also raised the strategic importance of India for the group. With US auto tariffs weighing on exports and Chinese automakers intensifying competition in Europe, Hyundai Motor announced at its CEO Investor Day in August plans to expand India production capacity by 320,000 units by 2030 and introduce 26 new and refreshed models.

Of the $15.5 billion investment, about $700 million will go toward R&D — including a local research and development center and a vehicle test track. The group plans to grow its local development workforce and research facilities to accelerate the development of vehicles tailored to Indian consumers and to secure next-generation automotive technologies.

The group will also deepen localization of parts. It plans to increase the share of locally sourced components and build a stable supply chain through strategic investment in and technology cooperation with Indian suppliers. Hyundai Motor Group operates parts, financial and logistics businesses in India through affiliates including Hyundai Mobis, Hyundai Transys, Hyundai Wia, Hyundai Glovis and Hyundai Capital.

A dedicated subsidiary will be established to execute the large-scale investment plan. The entity will coordinate investment priorities across production facilities, R&D and future technologies, and manage the disbursement of funds. It will also serve as a channel for identifying local startups and parts suppliers and pursuing strategic investments.

A concept image of the three-wheeled electric vehicle to be developed jointly by Hyundai Motor and TVS Motor Company. [Hyundai Motor]

The group is also expanding beyond conventional vehicle manufacturing. Hyundai Motor Group has completed a prototype of an electric three-wheeled vehicle (i3W) developed jointly with Indian two-wheeler maker TVS Motor Company and is working toward commercial launch by the end of 2027.

The group is also reviewing plans to broaden its business into new mobility services, automotive finance, electric vehicle charging infrastructure and end-of-life vehicle recycling.

Hyundai Motor Group currently employs more than 24,000 people directly in India. As production facilities and R&D operations expand, the group expects additional jobs to be created in related industries including engineering and the parts supply chain.

Vehicles roll off the production line at Hyundai Motor's Chennai plant in India. [Hyundai Motor]

Alongside its business expansion, the group plans to continue corporate social responsibility activities in India. "Hyundai Motor Group is fulfilling a range of social responsibilities — supporting the underprivileged and nurturing the next generation — to become a brand loved by the people of India," Chung said.

One flagship initiative is the Samarth campaign, which supports the social participation and independence of people with disabilities. Hyundai Motor Group funds training costs and related facilities for Indian para-athletes and produces video content to raise awareness about disability.

The group is also investing in technical talent development. Hyundai Motor's Indian subsidiary plans to establish and operate the Hyundai Academy for Technical Skills (HATS) in Chennai, Tamil Nadu, offering curricula in vehicle production and maintenance, smart factory operations, construction and industrial safety, with a goal of training about 13,000 skilled workers annually.

In addition, cumulative corporate social responsibility contributions made in India by key affiliates — including Hyundai Motor, Kia and Hyundai Mobis — reached approximately $110 million from 2016 through last year. The group said it will continue to invest in workforce development and community support alongside its expanding local business.

kwater@heraldcorp.com