Swaraj Baggonkar Moneycontrol News
Hyundai Motor India, that had pulled out two models from the entry hatchback segment -- Santro and i10 -- will return to the segment after five years with the relaunch of Santro. The Korean brand could also consider reviving the Eon, but is yet to take a final call.
YK Koo, MD and CEO, Hyundai Motor India spoke to Moneycontrol about the company's plans for the segment.
Edited excerpts.
Q. Do you expect some cannibalization within the portfolio?
A. The price and product positioning of the Santro is between Eon and Grand i10. We cannot deny cannibalisation (because of the Santro). But our marketing strategy is different for the Santro is a complete family car. And the segmentation is different. Grand i10 has an appeal to the urban buyer.
Q. Can the AMT be extended to another model?
A. We will have the AMT only on Santro in the brand of Smart Auto (the company's technology brand). We have the petrol and factory fitted CNG on the Santro. So if we are successful on the Santro then you can expect AMT to be extended to other models. On the Santro, two of the five variants will be given the AMT option.
Q. Are you looking to export the Santro as well?
A. Exports of the Santro will begin from 2019 onwards. We are looking at 20,000-30,000 units a year exports of the Santro in Asia, Latin America, Africa and the Middle East.
Q. How much are you aiming to sell in India?
A. We are targeting 8,000-10,000 units in India.
Q. Are we going to see Eon continue?
A. Eon is a very important product as entry low compact. Middle segment market size of a hatchback is 50 percent of the pie.
Q. Will Eon meet BS-6 regulations?
A. It will meet the regulations but we have to consider. Investments are very high. Even in the compact segment to meet emission regulation the investment is pretty high like diesel. The Santro’s engine can meet BS-6.
Q. Is the body of the Santro new or from an existing product?
A. The platform is that of the Grand i10 but we strengthened the body structure. 63 percent body of the Santro uses high strength steel.
Q. Don’t you have a capacity constraint?
A. We have a very flexible production for domestic and export market. Next year we will increase the production by another 50,000 units a year without any extra investments.
Q. When your competitor is adding new capacity you are holding back.
A. Last three months have seen no positive growth. We are not a volume player. We are not aiming for too much volume. The brand value, quality and customer satisfaction are the things Hyundai is focusing on.
Q. What is the pressure on business due to the depreciating rupee?
A. It affects our input costs because we import some parts from China. So the cost is very high. If this continues we have to consider a price hike. But not immediately.
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