Hyundai Motor and Kia to Collaborate with India’s Exide Energy on EV Batteries

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Hyundai Motor Co (005380.KS) and Kia Corp (000270.KS) have signed a memorandum of understanding with India’s Exide Energy Solutions Ltd to supply batteries for their electric vehicles, aiming to enhance their competitiveness in India, the world’s third-largest auto market. The partnership with Exide Energy, a unit of Exide Industries Ltd (EXID.NS), will focus on localizing EV battery production in India, particularly targeting lithium-iron-phosphate (LFP) cells.

Both Hyundai and Kia are looking to expand their presence in India, which is among their top four revenue-generating markets alongside the United States, South Korea, and Western Europe. Hyundai plans to invest approximately 3.25 trillion won ($2.40 billion) over ten years starting from 2023, with a focus on launching six EV models by 2028 and establishing charging stations. Meanwhile, Kia aims to introduce locally optimized small-sized EVs starting in 2025.

Exide Energy aims to commence production of EV battery cells by the end of this year, contributing to the development of a robust electric vehicle ecosystem in India. With India’s comparatively lower manufacturing labor costs and abundant lithium resources, the country presents an attractive opportunity for automakers looking to establish EV production facilities.

Shares of Hyundai Motor and Kia Corp closed higher following the announcement, reflecting positive investor sentiment. Additionally, Exide Industries saw a significant rally in its shares, reaching a record high, as investors responded favorably to the prospects of the partnership and the growth potential in India’s EV market.