Rural markets embracing midsize and large SUVs: Hyundai India COO

Hyundai sold 162,773 units of Creta during FY 24, an 8.2 percent growth from 1,50,372 units sold in FY 23.

A notable shift is underway in India's rural markets towards embracing midsize and large Sports Utility Vehicles (SUVs), a senior Hyundai Motor India Ltd (HMIL) official said.

"Rural markets contribute significantly to SUV sales, with certain models like Creta enjoying substantial popularity. This indicates a widening acceptance of SUVs among rural consumers," said Tarun Garg, Chief Operating Officer (COO) of HMIL.

He cited the significant contribution from rural markets for Hyundai's SUVs like Exter and Venue apart from Creta, noting a gradual shift in rural customers' preferences towards modern and larger SUVs.

During the middle of January, the South Korean carmaker rolled out the new-generation Creta, with the prices ranging from  with the prices starting from Rs 10,99,900 (ex-showroom) for the base version going up to Rs 19,99,900 (ex-showroom) for the top-end version.

Creta hopes

Despite intense competition in the midsize SUV segment, Hyundai remains confident about sustaining the market leadership of its best-selling model Creta in 2024-25.

Pointing to several new offerings from competitors such as the Kia Seltos, Honda Elevate, and Maruti Suzuki Jimny, Garg said the Hyundai Creta has maintained its pole position in the market.

"Despite competition, the Creta has shown resilience over the past two years. Even during the January-March 2024 quarter, we witnessed growth in Creta sales," Garg said.

Since its launch in 2015, the Hyundai Creta has dominated the midsize SUV segment for seven consecutive fiscal years. Garg disclosed that Hyundai sold 162,773 units of Creta during FY24, an 8.2 percent growth from the 150,372 units sold in FY23.

"It remains our flagship brand, and we are confident about its future performance. While specific market share projections may be uncertain, we maintain confidence in Creta's continued leadership in its segment," added Garg. He said that Hyundai holds a notable market share in the overall SUV segment and a significant share in the Creta segment.

Discussing the current demand for the Creta, Garg mentioned that the model continues to witness a substantial backlog of orders and has a waiting period of six to 24 weeks, depending on the variant.

Nearly two months later, the carmaker has also started offering the N Line edition, which is which is priced between Rs 16.82 lakh and Rs 20.30 lakh (ex-showroom).

SUV boom

According to the Society of Indian Automobile Manufacturers (SIAM), the midsize segment, encompassing SUVs between 4,000 mm and 4,400 mm in length and priced under Rs 20 lakh, accounted for 13.5 percent of the total Passenger Vehicle (PV) market in FY23. Industry observers note a significant surge in the mid-SUV market, rising from 3.43 lakh units in 2019-20 to 9.71 lakh units in 2023-24.

Industry data reveals a significant increase in the sale of midsize SUVs, with around 760,981 units sold in FY23, representing a 41.7 percent year-on-year growth. During FY 2023-24, the sale of midsize SUVs further increased to 971,930 units, indicating a 27.7 percent rise compared to the previous year. The segment's contribution to the total SUV market rose from 45 percent in FY23 to 46 percent in FY24.

Garg attributed the growing demand for SUVs to improved infrastructure and connectivity across the country, indicating a change in consumer perceptions regarding road conditions.

Meanwhile, Garg anticipates a modest growth of 2-3 percent in the PV industry for FY25, attributing it to factors such as the 'high base effect' of the previous fiscal and the normalisation of pent-up demand.