Talegaon plant preps Hyundai for exports, multi-model production

According to two people in the know, the facility, which produces 170,000 units per year, will first produce the new facelift version of the compact sports utility vehicle Hyundai Venue and possibly another model that is likely to be a new launch.

According to the company’s presentation to investors in New York as part of Investor Day 2025 last month, the Talegaon facility will focus on India-based products, exports to emerging markets and will have multi-model assembly capacity that will allow it to produce all types of vehicles, including electric vehicles (EVs) and internal combustion vehicles.

As factory operations expand with new vehicles, existing capacity will gradually increase to 250,000 units over the next three years, taking Hyundai’s total production capacity in India to around 1 million units annually.

Hyundai acquired the Talegaon plant near Pune from General Motors for an undisclosed amount in 2024 and has committed to invest. ₹Reportedly increased to 6,000 crore ₹11,000 crore. The company promised to invest in 2018 ₹7,000 crore to increase the capacity of the Chennai plant to over 100,000 units

“As of now, only two vehicles are planned in Talegaon, the new Hyundai Venue and a yet-to-be-announced vehicle,” said the first of the two people, who spoke on condition of anonymity. The Venue was Hyundai’s second best-selling vehicle in fiscal 2025, with 119,113 units sold out of the total 598,666 units in India.

Export plans

Plans by Hyundai’s global management for the new facility, which begins vehicle production on October 1, to act as an export hub for emerging markets, have led some analysts to contrast Maruti Suzuki’s recent pledge to set aside capacity to export its new electric vehicle to European markets.

“While Maruti Suzuki, a key rival, has made India its manufacturing base for some models, including exports to developed countries and improving export mix, HMI’s exports are seeing its product mix worsening and the company remains a manufacturing base only for emerging markets,” analysts at HDFC Securities wrote in an Oct. 1 note.

The second person mentioned earlier said that workers were being trained en masse at the Chennai plant before the start of production at the plant, and many Korean nationals also flew to India to help prepare the workers and the factory.

Analysts at Goldman Sachs suggested in an Aug. 11 note that Hyundai would initially target higher-volume models at the plant.

“We believe that HMIL will likely prioritize higher volume models in the new facility to more efficiently absorb early start-up costs and drive purchases to optimum utilization levels in the first 30 months of operations,” the note said.

S&P Global Mobility director Puneet Gupta said Chinese automakers are aggressively entering developed markets with far superior products in terms of technology and powertrains.

“For Hyundai to gain a foothold in these markets with Indian-made models, it needs to produce technologically advanced models in India that can stand shoulder to shoulder with global competition. Currently, the factory mostly produces cars that suit India’s needs, so it makes sense to export them to other similar emerging markets.”

Questions sent to Hyundai Motor India on October 8 remained unanswered.

Capacity increase, increased competition

As part of its push into the Indian market, Hyundai announced earlier this year that it would launch 26 new cars in the country, including new models and upgrades for existing cars. 20 of these 26 vehicles will be internal combustion engine (ICE), and the rest will be electric vehicles. The company also has plans to introduce hybrid vehicles.

The company’s management is expected to announce the details of its product plan to investors on October 15, when it is scheduled to hold its first investor day in Mumbai. According to the second person in the know, the company will try to add Hyundai Bayon, a compact SUV, to the Indian market.

Analysts have repeatedly emphasized that the company needs new capacity as its manufacturing facility near Chennai, Tamil Nadu is operating at peak capacity.

“Capacity expansion is much needed as the company is operating at over 90% utilization in FY24 and FY25,” HDFC Securities analysts wrote.

Increasing production is also vital at a time when the company is in danger of losing its second place behind Maruti in the Indian passenger vehicle market since 2009.

Between January and September 2025, Hyundai came under pressure from Tata Motors, Mahindra and Mahindra. During this period, Mahindra surpassed Hyundai from second place with 446,000 sales against Hyundai’s 425,000 sales.

Tata also closed the gap with Hyundai, which emerged as the second largest car seller with sales of nearly 60,000 units in September. Between January and September, Tata Motors sold 410,000 units in the Indian market.

Its rivals have also stepped up capacity expansion plans; Last year, Tata Motors launched an annual capacity of 300,000 units in Sanand, Gujarat, and built a capacity of 250,000 units in Panapakkam, Tamil Nadu. With the new additions, the capacity of the Mumbai-based automobile manufacturer has increased to over 1 million units.

Mahindra and Mahindra also announced in August that it will add 240,000 units per annum capacity to its Chakan plant to accommodate the new vehicle technology platform, taking its capacity to over 750,000 units per annum.

Hyundai’s share price is up 34% this year against a 15% rise in the Nifty Auto index.