Hyundai Motor Company on Wednesday signed a deal to acquire General Motors’ auto manufacturing plant in Talegaon, in the western state of Maharashtra, India, further strengthening the South Korean automaker’s will to expand its market share in the world’s third-largest car market.

Hyundai said the two sides decided to not reveal the amount of the acquisition.

According to Hyundai, it will be able to fully acquire the rights to the GM site once it obtains the Indian government’s approval before the end of this year.

The signing came about a week after Hyundai Motor Group Executive Chair Chung Euisun visited India to emphasize the importance of India as a foothold for future mobility. Early last week, the Hyundai Motor chief visited Hyundai Motor Company’s technical center and manufacturing site in India to discuss mid to long-term growth strategies.

“The decision to take over (General Motors India’s) Talegaon plant was made with the purpose to bolster our leadership in the fast-growing Indian market and actively cope with the automation of the Indian vehicle market, which is expected to be carried out quickly,” said Hyundai in a press release.

The Talegaon plant has an annual production capacity of about 130,000 units. Hyundai said it expects to begin production at the newly-acquired factory in 2025. The Korean automaker added that it is reviewing an option to increase the production capacity of the Talegaon plant through expansion plans in phases.

Having upgraded the production capacity of the Chennai plant, the automaker’s existing manufacturing site in India, to 820,000 units per year from 750,000 units per year earlier this year, Hyundai said the local production capacity could amount to 1 million cars per year in the near future.

Hyundai Motor Company sold about 550,000 cars in India last year to take up a 14.5 percent market share as the second-biggest automaker behind Maruti Suzuki.

With the world’s largest population, India saw 4.76 million new vehicles being sold last year, only behind China and the United States. Of them, about 3.8 million were passenger cars. While some of the global major auto markets such as China, Europe and the US have experienced a decrease in the size of their markets over the last five years, the Indian market for new vehicles jumped 18.5 percent from 2017.

The automaker also plans to set up a local production system of electric vehicles as India is poised to become one of the fastest-growing markets for EVs. The Indian government announced a plan to increase the proportion of EV sales to 30 percent of the total vehicle sales by 2030.

Approximately 48,000 EVs were sold in India last year, over threefold the figure in 2021. The country already saw 46,650 EVs being sold in the first of this year. The Indian market is expected to sell 1 million EVs in 2030.

Hyundai said the addition of the Talegaon plant will allow some breathing room for the Chennai plant as the currently popular models, which run on internal combustion engines, can be manufactured at the newly-acquired site. The automaker said the spare capacities at the Chennai plant could be utilized for producing EVs.

“This year will mark a new milestone for Hyundai Motor Company’s 27 years in India,” said Kim Un-soo, managing director of Hyundai Motor Company’s India operations.

“With the Talegaon plant’s operation beginning in 2025, we will set up a state-of-the-art manufacturing hub that can contribute to the growth of the Indian auto industry.”