Hyundai Motor signs deal to acquire GM India plant

Kim Eun-soo, executive vice president of Hyundai Motor India, Middle East & Africa Strategic Region, left, poses with Asif Khatri, vice president of production at GMI, after signing an acquisition agreement for the Talegaon plant in Gurugram, Haryana state, India, Wednesday (local time). Courtesy of Hyundai Motor Group

By Kim Hyun-bin

Hyundai Motor has acquired GM India's Talegaon plant in response to growing demand in India's rapidly expanding automotive market, Korea's largest carmaker said Wednesday.

The company signed an agreement to take over the assets of GM India's Talegaon plant located in Gurugram, Haryana state, India, Wednesday (local time). The signing ceremony was attended by about 20 officials from both companies, including Kim Eun-soo, executive vice president of Hyundai Motor India's (HMI) Middle East & Africa Strategic Region, and Asif Khatri, vice president of production at GMI.

"This year will mark a new milestone in Hyundai's 27-year history in India," Kim said. "Starting from the full-scale operation of the Talegaon plant in 2025, we will establish an advanced manufacturing hub that can contribute to the growth of the Indian automotive industry."

If the preliminary conditions, including approval from the Indian government, are met within this year, Hyundai Motor India will fully acquire the rights to the designated land and facilities of GMI's Talegaon plant.

Hyundai's decision to acquire GMI's Talegaon plant aims to strengthen its leadership in the fast-growing Indian automotive market and actively respond to the rapid electrification transition in India.

India, with the world's largest population, rose to become one of the top three global automotive markets, selling 4.76 million vehicles last year, following China (23.2 million vehicles) and the U.S. (14.2 million vehicles). The passenger car market is expected to exceed 5 million vehicles by 2030.

The Indian government recently set a goal to expand the share of electric vehicle (EV) sales to 30 percent of total vehicle sales by 2030 and is aggressively pursuing strong electrification policies.

Hyundai sold a total of 552,511 vehicles in India last year, capturing a 14.5 percent market share and securing the second position after Maruti. As of last month, Hyundai maintained its second position with a 14.6 percent market share, having sold 346,711 vehicles. However, despite the growth, there were limitations to meeting the increasing demand in India's automotive market due to production capacity constraints.

By acquiring GMI's Talegaon plant, Hyundai aims to secure additional production capacity to expand the supply of high-demand core models and establish a system to introduce various models swiftly. The Talegaon plant has an existing annual production capacity of approximately 130,000 vehicles and is expected to begin full-scale production in 2025.

In addition, Hyundai plans to establish a local EV production system to respond proactively to the anticipated rapid growth of the Indian EV market. Although the scale of EV sales in India was only around 48,000 vehicles in the previous year, accounting for 1.2 percent of the passenger car market, it has grown more than threefold compared to 2021, and sales are expanding rapidly to reach 46,650 vehicles in the first half of this year, approaching last year's annual sales volume. Annual EV sales are expected to reach 1 million vehicles by 2030.