Five billion dollars and a bunch of new cars: How Hyundai India is plotting a return to glory days

Mumbai/New Delhi: Hyundai Motor India Ltd will invest ₹45,000 crore in India and roll out a bunch of cars and SUVs over the next five years, as the company seeks to arrest the slide in its market share. However, the Korean carmaker has its sights firmly set on profitability in India, global president and chief executive officer Jose Muñoz said, on a day its operations chief Tarun Garg was elevated managing director and chief executive of the Indian business.

Hyundai, which has reigned as India's second-largest carmaker for over 25 years, has seen its market share slip in the last year, with local rivals Mahindra and Mahindra and Tata Motors breathing down its neck. However, the president emphasized that Hyundai will not engage in a price war, even if it meant losing the tag of being the country's No.2 carmaker. The Korean company is also bringing its luxury brand Genesis to India by 2027 to bolster its margins and brand perception.

“I want the profit, I want the volumes, I want the market share, I want customer satisfaction all together,” said the global head of Hyundai, pointing at Garg. “So, he knows (the task at hand),” he jested. Garg is the first Indian to lead the Korean carmaker in the country, while Muñoz is the first non-Korean to steer Hyundai globally.

“India is Hyundai’s global strategy,” said Muñoz , speaking at Hyundai Motor India’s first investor day in the country after its ₹27,870 crore initial public offering last October.

Over the next five years, Hyundai will launch 26 car models, including refreshes and model upgrades. Out of these, 13 will be internal combustion engine vehicles, eight hybrid, five electric and six running on CNG. As per its earlier plan this year, the company wanted to launch six EVs till FY30. With these, it wants to corner 15% of India’s car market by FY30. It ended FY25 with a market share of 14%, its lowest in over a decade. In the current financial year, Tata Motors and Mahindra have beaten Hyundai to the No.2 spot in all months.

Is 15% market share a low-ball target for Hyundai? Muñoz does not think so. “In most markets, not even the leader is at 15%. As the markets get more mature, it is more and more difficult to maintain a 15% share,” he said.

To achieve its target of 15%, Hyundai will venture into the hybrid vehicle space, something that was not part of its India plans till recently. The company had even lobbied against government incentives for hybrids. Muñoz attribution the hybrid plans to a change in its strategy.

“We recently changed our strategy from ‘shift to EV only’ to a much more ‘hybrid, plug-in hybrid and EV’,” he said. This change has happened across automotive companies and not just at Hyundai, he added. “We saw that EV market is not growing as much as we expected, for many reasons, and then hybrids have been growing more.”

“Our objective is to have sustainable, profitable growth,” Muñoz said at Hyundai Motor India’s first investor day in the country after its ₹27,870 crore initial public offering last October. “I don't want to lose the second position in the market. And if I can, I want to be number one. But I don't want to do it at the expense of losing profitability.”

Hyundai also plans to export three out of every 10 cars it makes in India by 2030. Export will be a key part of the company’s aspiration to maintain double-digit Ebitda margin in the country. It reported an Ebitda margin of 12.94% in FY25, which was 14 basis points lower than the preceding year.

The key destinations for Hyundai’s India-made cars will be the Middle East and Africa, Latin America and India’s neighbouring countries.

Hyundai will also bring its non-banking financial company Hyundai Capital to India, Muñoz said. The company has already applied with the Reserve Bank of India for a license to lend in India. Its plan is in three stages—first to lend to wholesale car buyers, mainly its dealers in India. Then, it wants to finance retail car buyers. In its third stage, the company plans to diversify to lending for operations other than vehicles.

The lending company will not be a part of Hyundai Motor India.

Gaurav Vangaal, associate director, light vehicle production at S&P Global said Hyundai Motor has an aggressive growth target that outpaces the industry, but its launch pipeline remains insufficient.

“Hyundai needs at least two new nameplates each financial year until 2030 to keep pace with the industry. Some competitors are already working to introduce at least two new nameplates annually. Incremental sales for the company will come only from new models.”