In the utility vehicle segment, the fastest growing car category in India, Hyundai Motor Company, with its two brands, has comprehensively edged past Maruti Suzuki, the segment and market leader.
Hyundai Motor India, alongside group company Kia Motors, accounted for one in every three vehicles sold in April in the highly-competitive UV market.
This segment, which saw cumulative sales of a million units in 2020-21, is the biggest driver of growth for India-based automakers.
In May, as lockdowns impacted sales across the country and companies shut down production at many of their plants, Hyundai and sister brand Kia — both owned by South Korea’s Hyundai Motor Company — together overtook the total passenger vehicle sales of Maruti Suzuki for the first time ever.
While Maruti Suzuki India Ltd (MSIL) sold 32,903 units in the domestic market in May, the Korean players, riding largely on SUV sales, recorded combined sales of 36,051 units.
It remains to be seen if this trend continues once vehicle delivery pipelines normalise, however. Most retail channels were closed in May, and Maruti had gone into a plant shutdown before Hyundai.
In April 2021, MSIL had the biggest market share in the UV segment at 23 per cent, followed by Hyundai Motor India and Kia Motors at 22 per cent and 15 per cent respectively. Together, however, Hyundai and Kia had 37 per cent market share in the segment, having sold a combined 39,936 UVs in that month.
The change in the pecking order has effectively pushed down the other two key players in the segment, Mahindra and Tata Motors. Toyota, which has the bestseller Innova, has been much lower down in the volume game (around 7 per cent market share in April), even though the addition of the rebadged Maruti Suzuki Brezza has helped it rev up the numbers in recent months.
While Maruti Suzuki has been pushed down in May, the numbers for the month have been impacted by market distortions on account of the retail shutdowns across most states, with analysts saying they would wait to see if the trend continues once the delivery pipeline smoothens.
But even as Kia’s all-UV product range has helped add to the tally, Hyundai has also been increasing its offerings, both in terms of models and variants — the new 5-seater Creta is the latest bestseller, and a 7-seater version is set to hit the roads soon. Kia is also launching products in the same price bracket of Rs 8-18 lakh.
Shashank Srivastava, ED at Maruti Suzuki said that while in the MPV segment, where MSIL has products like the Ertiga and XL6, the Japanese company is ahead, it is now behind in the mid-SUV segment.
“The mid-SUV segment has a lot of diesel products and we don’t have a diesel vehicle. We have Brezza and S-Cross, and product development is a continuous process,” he said.
It is, however, important to note that while the combined market share of Hyundai and Kia works at a group level, the two brands are rivals in various markets, including India. A senior official with Hyundai Motor India said the company “competes aggressively” with Kia Motor India — and while there may be some synergy at the group level on sharing of the product platform, the two companies have their own management, product design, R&D, marketing and service channels, and should not be seen as one.
Industry insiders, however, say that the success of the Creta led Hyundai Motor Company to introduce the Kia brand in India to capitalise on demand in the untapped SUV market. Kia entered India two years ago, and launched Seltos in August 2019.
Sources say that when Creta was launched in 2015, the company was expecting monthly sales of around 4,000. In April 2021, Hyundai and Kia together sold nearly 40,000 UVs, almost 10 times that number.
As per data with SIAM, in April 2021, UV sales stood at 108,871 units out of total passenger vehicle sales of 261,633 units, thus accounting for a market share of 41.6 per cent. The UV share in passenger vehicle sales in India has doubled over the last five years — from 21 per cent in 2015-16, it had risen to around 36 per cent in September 2019, and has witnessed a sharp spike over the last 6-7 months.
Kia launched Sonnet in September 2020, and Hyundai India launched its new Creta in March 2020.
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