Hyundai Motor Group is said to be planning to launch hybrid cars in India by 2026 at the earliest.

Hyundai Motor Group plans to launch its first hybrid cars in India as early as 2026, three sources said, as the South Korean auto group shifts its strategy to look beyond electric vehicles and strengthen its presence in a key auto market.

The group, which houses Hyundai Motor and Kia, is evaluating a hybrid sports car with dimensions similar to India’s best-selling Creta SUV, said two of the sources with direct knowledge of the plans.

Both Hyundai, which is India’s second-largest carmaker, and Kia are aiming to launch hybrid SUVs in 2026 or 2027, the two sources said, adding that their EV plans for India are also on track.

In a statement, Hyundai Motor Group told Reuters it was “committed to the future of electrified mobility and will optimize product strategies for each market.”

The move to hybrids – which use a petrol drivetrain and an electric motor – comes as Hyundai sees a surge in sales of the technology in India, prompting it to move away from an initial strategy that focused only on battery electric vehicles.

Hyundai and Kia, which now sell only petrol and diesel cars and imported EVs like the IONIQ 5 and EV6 respectively, are working to launch their first Indian-made EVs in the world’s third-largest auto market in 2025.

But EV sales have been slow to pick up due to high prices and inadequate charging infrastructure, prompting the company to turn to hybrids as an “interim strategy,” one of the sources said.

“Hyundai has the hybrid technology in other markets. Work has already begun to adapt this technology for cars in India to make it mainstream,” the source said, adding that growing consumer demand and adoption of hybrids in recent months has led to the change.

Total car sales in India will exceed 4 million in 2023, with EVs accounting for more than 2 percent. Hybrids, led by Toyota Motor, come close with a 2 percent share.

Hyundai is redoubling its efforts in India, where it is planning a $3 billion IPO, as it cuts production in China after years of losses there and after selling its two Russian plants.

Mid- and long-term strategies for India, including EV and hybrid plans, featured in discussions held by Hyundai Motor Group Executive Chairman Euisun Chung during his second visit to the country last week in less than a year.

India is Hyundai’s third largest revenue generator after South Korea and the United States.

© Thomson Reuters 2024