Kia is planning to invest US$ 1.5 billion in Andhra Pradesh to expand its manufacturing operations, as it looks to increase production capacity and strengthen its presence in the Indian automobile market.

The proposed investment is expected to significantly expand Kia's manufacturing footprint at its Anantapur facility, which currently has an installed annual production capacity of around 300,000 vehicles. The expansion, which is expected to include an additional production line, could increase the plant's potential annual capacity to around 500,000 units. This would give the company greater flexibility to accommodate new models and different powertrain combinations.

According to people familiar with the matter, Kia is expected to formally announce its expansion plans at the Andhra Pradesh Investor Summit scheduled to take place next week in Visakhapatnam. Although the proposal has not yet been officially disclosed, a formal memorandum of understanding (MoU) with the state government may be signed at the summit.

When contacted, Kia India said in a written response that it continued to see strong momentum across its portfolio, reflecting customer confidence in the brand. The company added that market response and evolving customer demand remained central to its product and business plans. It also said it was committed to catering to customers with different powertrain requirements, with recent portfolio additions reflecting this approach.

Kia further stated that it was expanding its range to provide customers with choices across vehicle segments and technologies. However, the company did not disclose any specific details about the proposed investment or manufacturing expansion.

The automaker also said that, as part of Hyundai Motor Group's commitment to India, Kia was aligned with the group's broader intention to expand manufacturing capacity to support future volume growth and strengthen India's role as a global export platform.

The proposed investment comes as Kia prepares to expand its presence in the Indian market through a wider product portfolio. The company plans to offer 10 models in India by 2030, including new SUVs, while strengthening its presence across petrol, diesel, electric, strong hybrid and factory-fitted CNG vehicle segments.

Rather than focusing on a single propulsion technology, Kia intends to follow a multi-powertrain strategy to address India's varied mobility requirements. Its future portfolio is expected to include internal combustion engine (ICE) vehicles, electric vehicles (EVs), hybrids and CNG-powered models.

Kia has set a target of selling around 410,000 vehicles annually in India by 2030 and increasing its market share to 7.6%. The company entered the Indian market in 2019 with the launch of the Seltos SUV, establishing a presence in the competitive passenger vehicle segment.

The expansion is also expected to support the wider development of the automotive manufacturing ecosystem in Andhra Pradesh. Three South Korean automotive components manufacturers have signed MoUs with the state government, indicating growing interest from suppliers in the region as Kia prepares to expand its operations. The proposed investment would further strengthen Andhra Pradesh's position as an emerging automotive manufacturing destination, as the state seeks to attract major investments in the sector.