Company MD said he is confident of a turnaround in market conditions
Despite nine straight months of demand decline for new cars, Hyundai Motor India will stick to its plan of pumping in Rs 7,000 crore for new manufacturing capacity, top officials said.
Speaking to Moneycontrol on the sidelines of the all-new Grand i10 Nios launch, SeonSeob Kim - President, CEO and MD of Hyundai Motor India said he is confident of a turnaround in market conditions which will raise the need for additional production capacity later.
“There is no change in our plans of investing Rs 7,000 crore in increasing capacity. There is no cutback in investments or product plans for India,” said Kim.
Earlier this year, Hyundai stated it will look to set up a new production capacity next to the existing factories near Chennai including infrastructure for producing electric vehicles.
Hyundai’s rival and India’s largest carmaker Maruti Suzuki also has not spoken of any delay in new capacities. Its parent company Suzuki Motor Corporation is scheduled to add 1.5 million units new capacity at Gujarat. Eicher Motors-controlled Royal Enfield is on schedule to start production at the new plant in Vallam Vadagal, Tamil Nadu later this year.
Hyundai’s Kim also said that except for slowdown in demand for hatchbacks the company has not seen demand getting affected for other models. “We undertook plant shutdown for a couple of days mainly to correct inventory of some hatchbacks. But demand for SUVs remain robust and we are running the SUV production line on three shifts on all seven days in the week,” Kim added.
Hyundai has received a roaring response for the Venue compact SUV that it launched a few months ago. The Venue, which competes with the Maruti Suzuki Vitara Brezza became the top-selling SUV in India in July.
Kim said through the lobby body the Society of Indian Automobile Manufacturers (SIAM) the auto industry has asked for a 10 percent reduction in GST on vehicles which can become a sentiment booster for the ailing industry. The government, however, has remained non-committal about any of the auto industry’s demands.
As per data shared by SIAM, the passenger vehicle industry comprising cars, SUVs and vans saw a sales decline of 22 percent during the April-July period to 913,410 units as against 1.16 million units sold in the same period last year.Sales of Maruti Suzuki fell sharper than the industry to 4.59 lakh units, down 25 percent during this year so far. In comparison, Hyundai saw a decline of 8 percent to 1.65 lakh units thanks to its new breed of models which restricted the fall.The Great Diwali Discount!
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