Hyundai-Kia Set To Localise EV Battery Production
Something big is coming up for electric vehicle owners. Hyundai Motor Company and Kia Corporation on Monday decided to partner with the inland manufacturer Exide Energy Solutions Ltd to localize electric vehicle (EV) battery production in India. Hyundai and Kia are set to concentrate on the production of lithium iron phosphate cells (LFP) as part of their electric vehicle (EV) strategies for the Indian market. This partnership will potentially position them at the forefront of using locally-produced batteries in their upcoming EV models for the Indian market, as Hyundai said in a statement from Seoul.
Heui Won Yang, president and head of Hyundai Motor and Kia’s research and development division stated, “India is a key market for vehicle electrification, particularly due to the government’s carbon neutrality goals, which makes securing cost competitiveness through localized battery production crucial.” He further added, “Through this global partnership, we will gain a competitive advantage by equipping Hyundai Motor and Kia’s future EV models in the Indian market with locally produced batteries.”
The two automobile companies signed a Memorandum of Understanding (MOU) with Exide Energy Solutions Ltd. intending to expand electric vehicle production in the Indian market. Shares of Exide Industries saw a big rise when they hit a 52-week high on Monday, closing the trade on BSE at Rs 377/piece, soaring up to 17.2 percent.
Exide and Hyundai have announced a collaboration on the development, production, and distribution of battery cells for Hyundai’s EVs aimed for Indian consumers. It is still unknown as to when the sourcing of battery cells would begin and whether this partnership would expand globally. The first phase of commercial production is most likely to begin by the end of the financial year 2025 with a capacity of 6 gigawatt hours (GWh) out of the total 12 GWh. This phase requires an investment of around Rs 4,000 crore and is a part of the total project cost of Rs 6,000 crore which is to be financed through internal accruals and bridge loans.
Hyundai company sells the IONIQ5 and Kona in the EV segment, while Kia India sells the EV6 model. Hyundai had announced a Rs 700 crore investment in a battery assembly plant in Chennai in November.
Exide Energy Solutions Ltd.
Exide Energy Solutions Ltd. or EESL is a subsidiary of the battery manufacturer Exide Industries, which is based in Kolkata. The division was established in 2022 and since then it has been involved in manufacturing lithium-ion cells, modules, and packs. The division incorporates a wide range of chemistries and form factors. Exide Industries has been thriving in India with over 75 years of experience. The corporation had announced in August 2023 that it was setting up a greenfield lithium-ion cell manufacturing facility in Bengaluru. Exide Industries has elevated India’s battery industry landscape with market leadership in lead-acid batteries. Mr. Subir Chakraborty heads as the Chief Executive Officer of Exide Industries Limited. Exide has established a long-term technical partnership with Chinese firm SVOLT Energy Technology for the lithium-ion cells project.
