At a time when original equipment manufacturer (OEM) automakers like Maruti Suzuki India Ltd (MSIL), Honda Cars India, etc., have decided to offer petrol-only models following the implementation of the second stage of emission norms, Kia India affirmed that there is a huge section of buyers who still look for diesel-driven models, such as the Seltos midsize sports utility vehicle (SUV), Sonet compact SUV, and Carens multi-purpose vehicle (MPV) for long-haul routes.
Senior officials of Kia India stated in a press briefing that the diesel-driven Seltos midsize accounted for 40 percent of its total sales before the implementation of the Real Driving Emission (RDE) norms and expect a similar contribution from the facelifted version of the same model.
As Hardeep Brar, Kia India Marketing and Sales Head, puts it, "We are expecting the (models that run on) diesel to stay strong and get the same kind of momentum. Basically, the customers who are doing long-distance driving are the ones who demand diesel (vehicles), and that percentage of customers doesn’t change."
He exuded confidence despite the proportion of diesel-run models falling in Delhi and NCR. "In a city like Delhi, it is lesser. But there are consumers in that city who want to travel long distances. But, yes, as a percentage, it is lower in bigger towns versus smaller ones, where there is a much bigger affinity towards diesel," he added.
Brar went on to assert that Kia India will continue to focus on internal combustion engine vehicles (ICEVs) despite its deep focus on electric vehicles (EVs). In his view, even if the country’s total passenger vehicle (PV) market becomes six million per year by 2030, 70 percent will still run on petrol, diesel, and CNG fuels.
"I think every market operates differently. Some of the developed countries are moving far ahead in terms of electrification. In India, the Indian government has said that by 2030, the Indian market should be about 30 per cent electric, which looks a little stretched at this point in time. Maybe 20 to 25 percent would be a more reasonable number. ICEVs, unless something drastic happens in the electric space (such as) battery costs going down significantly, will remain relevant," averred Brar.
However, he was categorically clear that Kia India has no plans for hybrid models in the country and will be zeroing in on EVs, which include a ground-up model for India by 2025. The South Korean carmaker also reaffirmed its plans to invest Rs 2,000 crore in making electric cars under the government of India’s production-lined incentive (PLI) scheme.
"Hybrid is coming in where the electric strategy is not very clear. We have a very clear electric car strategy. We have launched EV6. Come 2025, we will be ready with the electric car for India. So, for one-and-a-half years, bringing in a hybrid as an interim solution doesn't make any sense," stated Brar.
Meanwhile, Kia India affirmed that the semiconductor crisis has abated as it has been able to source 95 percent of the semiconductor chips required for production. The automaker is confident of getting regular supplies, even for the revamped Seltos, which is loaded with multiple semiconductor chips.
"Based on the bookings (of Seltos) that we will receive, we will ascertain what percentage of consumers are adopting the ADAS (variant)," maintained Brar. He also claimed, "I think the situation is pretty close to normal, and a 5 percent deficit will always remain because of the forecast and supply issues."
Meanwhile, Kia India maintained that the Sonet will remain its entry-level model, and it has no plans to launch either a hatchback or a mini SUV (based on the upcoming Hyundai Exter) below that model. It also has no plans to get into premium sedans in the foreseeable future.
"We are studying the market situation and all the segments. At present, the market trend is (shifting) from sedans to SUVs. And this is a global trend. So that's why we are not considering producing sedans or small cars in India," said Myung-Sik Sohn, Chief Sales & Business Officer, Kia India.
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