OCTOBERASIA BUSINESS OUTLOOK8NEWSROOMBYD ABANDONS $1B MANUFACTURING PLANS IN INDIA, STICKS TO IMPORT STRATEGYHyundai Motor India has announced a substantial investment plan of Rs 32,000 crore over the next decade, from 2023 to 2032, as revealed by Unsoo Kim during a press conference in Mumbai related to the HMIL IPO. Additionally, the company will allocate Rs 6,000 crore for its Pune facility. They are focusing on expanding its capabilities in the electric vehicle (EV) segment while pursuing a strategy of premiumization. The company views the SUV segment as a significant The new plant in Pune is expected to increase Hyundai's production capacity from 824,000 units to approximately 1.1 million units, representing a 30 percent increase by 2028. This capacity expansion aims to provide significant headroom for both domestic sales and exports, enhancing the company's market share.The company plans aggressive investments in new product development, advanced technologies, and R&D capabilities within its Indian operations. The upcoming IPO, scheduled for subscription from October 15 to 17, will allow local and global investors to participate in Hyundai's growth trajectory.Hyundai highlighted its record-high rural penetration in India, dispelling the myth that rural customers predominantly prefer small cars. According to the company, the SUV contribution from rural areas has matched that of urban regions from January to September this year. This demonstrates a growing acceptance and demand for SUVs among rural consumers, further solidifying Hyundai's strategy in the Indian market. Chinese electric vehicle (EV) manufacturer BYD has decided to adopt an "import-only strategy" for the Indian market, following the Indian government's rejection of its $1-billion investment proposal to establish a car manufacturing plant. Under India's new EV policy, BYD will continue importing its vehicles rather than setting up a factory locally.Rajeev Chauhan, head of BYD's electric passenger vehicle business in India, announced this strategic shift while introducing the company's new multipurpose vehicle, the eMAX 7, priced between Rs 26.9 lakh and Rs 29.9 lakh (ex-showroom). Despite hefty customs duties, BYD aims to sell 3,500 units this year, reflecting a 40 percent increase from the previous year's sales of 2,500 units.Currently, BYD imports three models from China and believes this strategy is sufficient for the short term. However, Chauhan hinted at possible future investments in India, stating the company is open to expansion opportunities if conditions improve.Although import-only operations result in higher vehicle prices, BYD's strong supply chain has helped manage costs. Chauhan acknowledged that local manufacturing would have reduced prices but emphasized that the company has positioned its vehicles competitively despite the import model.Speculation also suggests that BYD is in discussions with Indian corporate houses for potential partnerships, similar to MG Motor's alliance with JSW Group, though no confirmation has been made. HYUNDAI LOOKING TO VENTURE INTO INDIA'S PREMIUM EV MARKETS
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