Hyundai to acquire General Motors factory in India

Kim Myeong-ju & Kim Tae-gyu, UPI News Korea
·2 min read
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UPI
These are the automotive facilities of General Motors in Talegaon, India. Hyundai Motor agreed to acquire them, but did not disclose the price. Photo courtesy of General Motors

SEOUL, Aug. 17 (UPI) -- South Korea's Hyundai Motor said Thursday it will purchase from General Motors a factory in Talegon, India, some 720 miles southwest of New Delhi.

The deal covers the acquisition and assignment of land and buildings, as well as some machinery and manufacturing equipment, according to Hyundai Motor.

The Seoul-based automaker did not disclose how much it would spend on the purchase in a deal signed by Hyundai India CEO Kim Un-soo and GM Vice President Asifhusen Khatri.

Last year, China's Great Wall Motor tried to acquire the same GM factory, reportedly offering $300 million.

Hyundai's plan for the rollout at the Talegaon factory is for 2025, a move expected to help increase its annual capacity in India from 820,000 units to almost 1 million.

Hyundai already operates production facilities in Chennai, with sister company Kia also running a factory in Anantapur in southern India.

"With the expanded capacity as leverage, Hyundai Motor India will review options for launching additional electric vehicle models in the Indian market," Hyundai Motor said in a statement.

Over the past several years, Hyundai has been heavily investing in India, the world's third-largest automotive market following the United States and China.

In May, the company announced plans to channel $2.4 billion to modernizing its facilities and establishing an ecosystem for EVs in cooperation with the Indian government.

Hyundai is the second-largest automobile brand in India with a market share of 14.5% as of last year. The leader there is Maruti Suzuki, the subsidiary of Japan's Suzuki Motor.

"Hyundai is struggling to meet production demand in India where the car market is growing at a very fast clip," Daelim University automotive professor Kim Pil-soo told UPI News Korea.

"That's the reason for buying GM facilities. The company seems to be more focused on India, with a population of 1.4 billion, instead of China where global brands are continuing to lose ground," he said.