Kia to invest 2.1 trillion won in India plant for 500,000-unit annual capacity

Kia is making a large-scale investment to significantly expand production capacity at its Anantapur plant in Andhra Pradesh, India. The strategy is to solidify its leadership in the fast-growing Indian auto market by expanding production infrastructure capable of handling locally tailored new models and diverse powertrains.

On Nov. 7, Kia India was reported to be planning a $1.5 billion (about 2.1 trillion won) investment in the Anantapur plant expansion. The plan is to raise annual production capacity from the current 300,000 units to 500,000 units by adding a new production line.

The capacity expansion is driven by clear sales growth in the Indian market. Kia sold 32,017 units in India in September 2026, up 41% from a year earlier and a record monthly high, then shipped 33,462 units in October 2026, breaking the record in just one month. Cumulative sales for January–October 2026 reached 286,470 units, already surpassing last year's annual total of 280,286 units.

In step with Kia's expansion plan, Korean parts makers are also strengthening their local supply chains. Three Korean auto parts companies—Hwashin, Seoyon E-Hwa, and Iwamet—recently signed investment memorandums of understanding with the Andhra Pradesh state government worth 16.14 billion rupees (about 266 billion won). They will build new manufacturing facilities near Kia's Anantapur plant and create more than 1,400 jobs.

The parts makers' nearby entry greatly improves Kia's local production efficiency. Vertically integrating key parts supply chains near the finished vehicle plant cuts logistics costs and shortens parts procurement time. The state government also plans to develop the area into an automotive industry cluster through this investment.

The investment also affects the reorganization of logistics networks in southern India. Korean parts makers had mainly been based near Chennai in Tamil Nadu, which has a port, but with this investment the supply chain is extending inland to Anantapur in Andhra Pradesh. This narrows the distance between parts assembly lines and the finished vehicle plant, enhancing the stability of the just-in-time production system.

With the expanded production line, Kia can respond flexibly to new model allocation and powertrain diversification. Kia is currently increasing sales in India centered on the Seltos and Sonet, and is preparing to expand its eco-friendly lineup including EVs and hybrids. The added capacity provides the physical foundation for producing these new models.

Detailed schedules for the Anantapur plant expansion are expected to be finalized at the Andhra Pradesh Investment Summit to be held next week in Visakhapatnam. Kia India said, "This expansion is aimed at meeting the evolving needs of Indian customers and supporting growing local vehicle demand."

※ This article is an AI translation of the Korean original published by Korea Credit News; it was checked by automated quality guards and published by the English edition desk.