Having invested nearly Rs 30,000 crore in India since starting operations in 1996, the leading car manufacturer from Korea stressed the importance of stable policies. They believe that consistent government guidelines are crucial for confidently making the necessary technological upgrades mandated by the government, ToI reported.
“Another challenge that the industry is facing is frequent changes in policies, which make it difficult for auto industry stakeholders not only to ensure adherence but also commit investments,” the company noted in its Draft Red Herring Prospectus submitted to market regulator SEBI. “Overall policy stability and transparency will be required going forward to ensure smooth technology transition and localisation in the country,” it added.
Hyundai plans to invest Rs 32,000 crore more in India in the coming years. This investment will focus on launching electronic vehicles, building the necessary infrastructure for green technologies, and boosting production capacity.
The company highlighted that electric vehicles (EVs) will be a primary focus. Hyundai aims to localise the manufacturing of electric vehicles for the mainstream, high-volume market.
However, the draft prospectus also mentions concerns regarding the localisation norms encouraged by the government, which is promoting the growth of EVs.”Govt is encouraging localisation across sectors, especially in the automotive sector via policies like PLI for automotive technology, PLI for advanced cell chemistry, phased manufacturing programme, atmanirbhar Bharat, and make in India,” said Hyundai.They note that while the goal of localisation is to reduce import dependence and lower manufacturing costs, it requires significant initial capital investments from various industry stakeholders.
“While the government has designed the schemes to support investments by offering several subsidies and import duty benefits, there are still concerns around meeting the eligibility criteria and availing of the benefits,” the company mentioned.
Hyundai stated that “simplification and better tracking of policies” will aid in achieving localisation within India. They believe that the progress of vendors linked with individual OEMs could alter the industry’s risk profile from a supply-side perspective.
To enhance the price competitiveness of its EV models, Hyundai intends to focus on establishing local production capabilities for essential parts. This includes cells, battery packs, power electronics, drivetrain, and building a localised EV supply chain.
(With ToI inputs)
