In a change in strategy, Hyundai India has stopped car exports to the European Union from July this year, opting to shift the Euro-specification models to its new plant at Turkey in order to free up capacity for domestic demand. The South Korean carmaker, currently the largest car exporter from India, had previously used the country as a base for small car exports, especially for popular models like the i10 and i20.
Rakesh Srivastava, senior VP for marketing & sales said that total export volumes will drop over 18% this fiscal (FY14) to about 1.9 lakh units, while domestic sales is estimated to rise 8% to 4.10 lakh units as the consumer sentiment start to show an improvement. Hyundai has launched four new cars this year, the Grand i10, Xcent, Santa Fe and the new i20 on Monday.
“We are expanding exports to other markets in Latin America, Asia, middle-east and Australia. EU accounted for 40% of our exports, but we don't see EU exports stopping as a loss because we will gain on the domestic front. We will add capacity at home when we exhaust what we have,” he said.
Hyundai currently has an annual installed capacity of 6.4 lakh units at its two plants near Chennai, which can be increased to 6.8 lakh units with minor investments.