We sat down with the Hyundai India Managing Director, Mr Y. K. Koo, to discuss the Korean manufacturers plans for 2016.
2015 was a good year for Hyundai, what do you envision for 2016?
2015 was the year of excellence for Hyundai. We did a good job with the combined effort of sales, marketing, and even our factory. In spite of the heaviest downpour in the last century in Chennai last year, they did a fantastic job. We met our production numbers without being affected by the flooding. In terms of sales as well, we did a good job. Last year, we sold 476,000 units – which gave us a market share of 17.3%, a 1.1% increase compared to 2014. We increased our volume by 16%, compared to an industry growth of 8%. So, overall, it’s an excellent performance for us in the Indian market. India is very important for us, as it’s the third largest market in the world for us – after China and the USA. So, in terms of units, it’s larger than our sales in all of Europe. And, even in 2016, after January and February, we grew by 9% over the corresponding period last year – while the market only grew by 1%. So, we’re on the right track and aiming for half-a-million sales this year while maintaining our market share.
The Creta has been a huge success for Hyundai. You’re introducing the Tucson later in the year, and you recently showcased your compact SUV concept at the Expo. When are you likely to launch that in the Indian market – and what about your development plans for an MPV in India?
I came to India in October 2015, and I think India is a right country for SUVs – similar to Russia and China. The country is large, and the road conditions are mainly off-road. Plus, driving time is large. So, SUVs are the right product. As of now, SUVs make up almost 15% of the entire market, and it’s continuing to grow. With the Creta, so far we’ve got 500,000 inquiries and 100,000 bookings. As of now, we’ve sold 54,000 units. The waiting period was between 4-5 months, so we’ve increased our production to 10,000 currently, and will increase it further to 13,000 units from the 1st of June. This will give us 10,000 units dedicated for the domestic market, and 3,000 for exports.
We’ve also made the decision to introduce the Tucson, which is in a higher segment from the Creta. This will give us a full line up of SUVs, with the Creta, Tucson and the Santa Fe. As for the sub-four metre concept SUV, which we displayed at the Auto Expo, the product is under development at the global R&D centre in Korea for the Indian market. It’s too early to talk about when it’ll come to India, but what I can say is that it will come in the near future. We are developing it with a 1.0-litre turbo engine purely for the Indian market. The MPV is still under consideration, but right now the SUV is our main priority. So, first the SUV, then the MPV!
What about adding more automatic transmissions or AMTs to your range?
Definitely, we have to review AMTs and even hybrid products. We have already discussed this with the Global R&D centre in Korea, and it’s under review. We have a product line up, wherein we have the Elantra Hybrid and the Sonata Hybrid. So, we’re talking to the global R&D centre to decide when it would be the right time to introduce both hybrids and AMTs for the Indian market.
Are you disappointed that the Union Budget didn’t have any incentives for hybrids?
We cannot say it’s a disappointment. I think it’s better to say that there’s a little concern that the Union Budget didn’t have any motivation for the automotive industry. On the other hand, cars will get more expensive. So, it’s a concern for the industry that there may be a slow down for the next couple of months. On the other hand, they have a good scheme to motivate the rural market and the agricultural sector. So if the overall economic situation improves, we have a greater chance to penetrate the rural markets.
What is your response to the diesel ban in the NCR?
I think the demand for diesel is coming down to be frank – not only in Delhi, but also in other metro markets. For example, in Bangalore as well demand for diesel is down. In Delhi, of course, it has dropped very fast when compared to other metro markets – because the customer expects depressed resale values for diesel cars. For us, it’s not much of a problem because we can be flexible in our production at the plant. I believe that the demand for diesel will drop further, but that’s my personal opinion.
What about your plans to develop a Greenfield plant?
At the moment, we don’t have any plans for a new plant. We can stretch our production to 7 lakh units, so that should give us some volume for exports as well. Also, since we have a flexible production system I think right now we have enough production capacity to meet the Indian market demand.
You recently inaugurated your first Digital Showroom experience. Do you think augmented reality and virtual reality will revolutionise the retail experience for customers?
In 2016, we’ve launched the ‘Experience Hyundai’ programme – and a smart and digital showroom is a key pillar for us to implement. The investment is not too much, but the location is very important as it requires a shopping mall or an area with high footfall. We need digital showrooms in Metro cities first – where a small area with small investment, but maximum footfall, is required to generate maximum efficiency. This month we inaugurated the first digital showroom in Delhi, and next month we are opening another one in Hyderabad. We have also received interests from dealers in other cities as well, as this concept provides a very easy experience for the customer.
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