Hyundai may launch its electric car before Maruti Suzuki

Hyundai India CEO Y.K. Koo. The carmaker, which will showcase two electric cars at Auto Expo 2018, has asked the govt to reduce GST rate on electric and hybrid vehicles. Photo: Pradeep Gaur/Mint

New Delhi: Hyundai Motor India Pvt. Ltd, India’s second largest car maker, plans to launch its first electric car in India by 2019, a year earlier than arch rival Maruti Suzuki India Ltd plans to enter the segment.

The company has not decided whether it would bring its electric car brand Ioniq or introduce a new vehicle on a sport utility vehicle (SUV) platform, Y.K. Koo, managing director and chief executive of the Indian unit of the South Korean car maker, said in an interview to Mint.

If things go according to plan, Hyundai will be the first foreign passenger vehicle maker to launch its electric vehicle in India.

“The product will be brought to India in a complete knocked down version (CKD) because we are not much assured of the success of EV products in the Indian market but to showcase that we have the technology. We are bringing this EV product as CKD to test the market,” said Koo.

India is the fourth largest market for Hyundai Motor Co. after the US, China and South Korea. In 2017, the Indian subsidiary contributed 15% of the total sales of the parent company globally against 13.6% in 2016.

According to business portal Business Korea, Hyundai and its subsidiary Kia sold 12,992 electric vehicles in 2016. The total number of electric cars sold in 2017 is not yet available.

Koo insisted there is a need for a clear road map for electric vehicles. “We need a clear picture from the government but we cannot wait. Still, we are waiting for a detailed road map to be proposed and developed by the Niti Aayog,” Koo said.

Globally, Hyundai sells fully battery-powered electric vehicles, hybrid and plug-in hybrid vehicles under the Ioniq brand. The South Korean car maker is also expected to showcase two of its electric cars during the forthcoming Auto Expo scheduled to be held in Greater Noida in February.

Hyundai, unlike Maruti Suzuki, is not planning to establish its own charging stations as it would be expensive and the onus to do that is on the local government, Koo said.

“If we have to establish charging stations then it will be very expensive. OEMs should develop the products, bring technology and price it aggressively but the road map for charging infrastructure should be built by the government and then we will follow. The government should develop infrastructure and should guide us about some GST (goods and services tax) benefit and other things,” said Koo.

The company has requested the government to reduce the existing GST rate on electric and hybrid vehicles and give some subsidy on lithium-ion batteries.

“It is a fairly good move by Hyundai to be the first foreign manufacturer to launch electric vehicles in India. The government is in the policy making stage and there is nothing concrete on the ground. If Hyundai indeed becomes the first one to launch electric vehicles then it can leverage its first-mover advantage and it will also boost their credentials in front of the policy makers,” said Anil Sharma, principal analyst, at IHS Markit, a forecasting firm.