Hyundai Motor India's Resilient Growth Amid Domestic Market Softness: A Strategic Play in SUVs and EVs

In the face of a slowing Indian automotive market, Hyundai Motor India (HMIL) has emerged as a standout performer, leveraging its SUV dominance, electrification strategy, and export-driven model to insulate itself from domestic headwinds. As domestic sales of passenger vehicles contracted by 12.1% year-on-year in June 2025, HMIL's SUV segment—led by the iconic Creta—remained a bulwark of stability. SUVs accounted for 69% of HMIL's total passenger vehicle sales in the first half of 2025, with the Creta alone selling 100,560 units from January to June, securing its position as the best-selling SUV in India. This resilience is underpinned by a decade-long legacy of innovation, a diversified powertrain strategy, and a forward-looking approach to electrification.

The Creta: A Decade-Long Champion

Since its launch in 2015, the Creta has redefined the Indian mid-size SUV segment. In Q2 2025, it maintained a commanding 31% market share in its segment, outpacing rivals like the Kia Seltos and Maruti Grand Vitara. The third-generation Creta, launched in 2024, introduced Level 2 ADAS, dual 10.25-inch screens, and a refined driving experience, aligning with India's growing demand for tech-rich, semi-autonomous features. Notably, 70% of Creta buyers in H1 2025 opted for sunroof-equipped variants, signaling a shift toward premiumization in the mass-market segment.

The Creta's success is not confined to its design or features. Its powertrain flexibility—petrol, diesel, turbo, and now electric—caters to a broad spectrum of consumer needs. The Creta Electric, launched in January 2025, has already sold 4,000 units in H1 2025, capturing 5% of India's BEV market. This model, India's first locally produced EV from Hyundai, is not only a domestic hit but also a key export asset, with waiting lists stretching 4–6 months due to limited charging infrastructure.

Export-Driven Resilience: The Talegaon Plant's Role

Hyundai's strategic expansion into export markets has been a masterstroke in mitigating domestic volatility. In Q1 FY2026, exports surged 13% year-on-year to 48,140 units, accounting for 26.7% of total sales. Emerging markets like Saudi Arabia, South Africa, Chile, and Peru have become critical growth engines, with SUVs and EVs forming the backbone of this export strategy. The newly acquired Talegaon plant, located in Pune, is central to this ambition.

Acquired from General Motors in 2023, the Talegaon plant has a production capacity of 130,000 vehicles and 160,000 engines annually. Full-scale passenger vehicle production is slated to begin in Q4 2025, boosting HMIL's total capacity to 1.074 million units. This expansion supports both domestic and international demand, with the plant expected to reduce dealer wait times and facilitate the Creta EV's global rollout. The plant's focus on smart manufacturing and robotics aligns with Hyundai's global electrification goals, positioning it as a hub for traditional and EV production.

Hyundai's “Make in India, Made for the World” initiative is gaining traction, with the Talegaon plant already exporting Creta models to neighboring countries like Nepal and Bangladesh. The company aims to increase exports to 30% of total volume by 2030, a target achievable given the growing demand for Indian-made SUVs in Africa and Latin America.

Electrification and Long-Term Growth

Hyundai's EV strategy is a critical pillar of its long-term resilience. The Creta Electric is just the beginning; the company plans to introduce six new EV models by 2030, including battery pack assembly in Chennai. This ecosystem approach, coupled with a ₹380.5 crore investment in the FPEL TN Wind Farm, underscores Hyundai's commitment to sustainability and cost efficiency.

The EV segment is poised to become a profit driver as India's government accelerates EV adoption through subsidies and infrastructure investments. Hyundai's localized production and early mover advantage in the Creta EV segment position it to capture a significant share of this growth.

Investment Implications

Hyundai Motor India's strategic positioning in SUVs and EVs, combined with its export-driven model and robust manufacturing infrastructure, makes it a compelling long-term investment. The company's ability to maintain SUV dominance (69% of sales) while pivoting to electrification ensures relevance in both current and future markets. The Talegaon plant's expansion and export ambitions provide a buffer against domestic market softness, while the Creta's legacy and EV innovation drive recurring revenue streams.

For investors, HMIL represents a rare combination of short-term resilience and long-term growth potential. As the Indian automotive landscape evolves, Hyundai's focus on SUVs, EVs, and global exports positions it to outperform peers and deliver consistent returns.

In conclusion, Hyundai Motor India's ability to adapt to shifting market dynamics, coupled with its strategic investments in electrification and global manufacturing, underscores its status as a resilient and forward-looking automaker. For those seeking exposure to India's evolving mobility sector, HMIL offers a compelling case.