Korean carmaker Hyundai is keen on giving India's largest carmaker a run for its money. But even as it challenges Maruti Suzuki's position in India, Hyundai is eyeing bigger fish -- using India's latest elevation to Hyundai's number three market globally to spearhead its volume-based global strategy, reports CNBC-TV18's Ronojoy Banerjee.
It's been 20 years since Hyundai formally drove into India, and in this 20th year, Hyundai India has zoomed past another milestone -- India is now its third biggest market after China and USA, with the 29-nation European union bloc falling into fourth place.
This explains why Hyundai is now banking on India to drive its thrust in the emerging markets by becoming the export hub for these markets. Of course, this will also mean that Hyundai is putting more effort into increasing its domestic market share.
To generate volumes, India's second largest carmaker plans to diversify into every product category in India -- and close the gap with number-one player Maruti Suzuki.
Says YK Koo, MD and CEO, Hyundai Motor India, "Maruti has experience of over 30 years. We are trying to increase our market share in India. India is a key market for Hyundai globally especially because the total size of market will increase to 4 million units by 2020. In 2016, we will be selling over 500,000 units in India. We have presence across products"
This heralds a big shift in strategy.
For instance, in India, Hyundai has always maintained a clear lead in the export market. But CNBC-TV18 learns that Hyundai India has not only withdrawn its exports from the European markets, it has also brought down exports of cars produced in India to 35 percent from 50 percent.
Even these exports will be carefully calibrated. Given the success of the SUV Creta, the company is set to hike production of the vehicle by 30 percent so it can cater to markets like South America, Middle East and Mexico. The car, the Hyundai India chief says, will be exported to 92 countries.
To this end, Hyundai is also, for the first time, aligning its India R&D team to its global office. This team will also work on bringing newer vehicles to India. Like a compact SUV codenamed HND-14, which was showcased at the Auto Expo earlier this year.
This car will be primarily developed in India for the rest of the world and in India, will take Maruti's latest offering, the Brezza, head on.