Hyundai Eyes Double Engine Growth After GST Rate Cut

Mumbai, September 15, 2025: Hyundai Motor India Ltd (HMIL) is working on a fresh growth phase after the new GST rate cut, which is set to increase the demand for cars in the domestic market. As per HMIL’s senior executive, the company is banking on a “double engine” approach, which is a twofold plan of balancing stronger home sales with steady export growth.

Domestic Sales Under Pressure, Exports Rising

Between April and August this year, Hyundai’s India sales dropped 11.2% to 2,20,233 units, down from 2,47,992 units last year. Exports, however, increased by 12.45% to 80,740 units versus 71,800 units earlier. HMIL officials noted that while earlier capacity limits had held back exports, stronger overseas demand has now offset weaker domestic performance.

GST Rate Cut to Boost Sentiment

Hyundai officials believe that both rural and urban car markets might see an increase in sales due to the reduction in GST rates. Urban demand is based solely on consumer sentiments, while rural buying confidence depends mainly on monsoon, farm output, crop prices and related infrastructure. Expectations are that the recent GST rate cuts might improve car buyers’ confidence and can lead to a broad recovery phase, despite global and domestic challenges faced last year.

Expanding Capacity to Meet Growth

At present, Hyundai’s Chennai plant can currently produce around 8.24 lakh cars per year. A jump of almost 20% is expected with its new Talegaon unit in Maharashtra with a manufacturing capacity of around 1.7 lakh cars, bringing HMIL’s total production close to 11 lakh cars per year.

Exports Gain Share

Last year, exports made up 21% of Hyundai’s revenue, increasing steadily to 27% in the first quarter this year. Hyundai believes that with the domestic demand expected to improve and exports still remaining strong, both of these markets might show substantial growth numbers. This increased production capacity will give Hyundai enough room to meet demand in both of these markets.

Outlook

Hyundai is expecting recovery in domestic demand along with steady growing exports will help in keeping the growth plans intact. The easing of production bottlenecks and friendly government policies are likely to support this balance between these two markets.

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