Hyundai Motor India (HMIL) has emerged as the leader in the sports utility vehicle (SUV) segment, beating rivals. The SUV segment retails the largest number of vehicles within the passenger vehicle segment and has become crucial for all car manufacturers, who are increasing their portfolio in the segment with either new launches or new variants of existing models.
In January-June 2021, the country’s largest passenger vehicle manufacturer, Maruti Suzuki India sold 1,23,168 UVs (SUVs plus multi-utility vehicles) in India, at an average monthly rate of 20,528 units. In the same period, Hyundai sold 1,27,173 SUVs (21,196 units per month), as per sales data by the Society of Indian Automobile Manufacturers (Siam).
While Maruti Suzuki has three SUVs (Gypsy, S-Cross and Vitara Brezza) and two MUVs (Ertiga and XL6) in its portfolio, Hyundai sells four SUV models (Venue, Creta, Alcazar and Tucson) and currently doesn’t have an MUV. The share of SUVs within the PV segment has been rising over the years. Industry sources say while in CY15 SUVs contributed 13.5% to PV sales, in CY19 this rose to 25.6%, 29% in CY20, and about 35% in H1CY21. “In CY20, Hyundai sold 15,000 SUVs per month, but in H1CY21 we have been able to raise it to 21,196 SUVs per month,” Tarun Garg, director, sales & marketing, Hyundai Motor India, told FE.
The Korean automaker has been riding high on diesel model sales and features on the dashboard it offers to customers, as also the increasing usage of personal mobility after the pandemic.
“Post the pandemic, an increasing number of people are travelling with their families in personal vehicles even for long distances and especially for vacations,” Garg said. “Earlier if vacation holiday on a self-driving vehicle was limited to 200-300 km — and beyond that it was via trains or flight —now that has increased to over 500 km. People increasingly prefer cars loaded with features — because they are spending a longer time in the car —and with a diesel engine, especially in the midsize SUV space and above.”
This, in part, explains why the automaker’s focus on diesel after BS6 has been paying off well — the time when Maruti Suzuki exited the diesel space. Garg said there are certain markets where diesel outsells petrol in cars that cost above `10 lakh (Maruti Suzuki doesn’t have too many models in that price range). “While about 60% of all-India Creta sales are of diesel variants, in Punjab it’s 68%, in Madhya Pradesh 67%, in Andhra Pradesh 66%, in Uttarakhand 65%, and in Uttar Pradesh it is 63%,” he said.
The more expensive the car, the higher is the diesel engine sales percentage. For example, in Hyundai Alcazar — launched in June and priced Rs 16.3 lakh to Rs 20.14 lakh, more than Creta’s Rs 10.16 lakh to Rs 17.78 lakh — the diesel variants’ sales share is 65%. “As far as bookings of the Alcazar are concerned, in Madhya Pradesh 82% are for diesel variants, in Rajasthan it is 82%, Andhra Pradesh 81%, Gujarat 73% and Uttar Pradesh 67%,” Garg said.
“What has helped is that we are able to offer the diesel option at a marginally higher price than the petrol; for example, in the Alcazar, the price difference between petrol and diesel models is in the range of `15,000-25,000, even after BS6. So, our focus on diesel has been paying off.”
Going forward, analysts said Hyundai will be able to maintain the lead in UVs at least in this calendar year, but post that Maruti Suzuki could bounce back. Gaurav Vangaal, associate director, IHS Markit, told FE that in CY22 both the automakers could be competing neck and neck in UVs. “Maruti Suzuki is expected to launch the new Vitara Brezza early next year and an all-new seven-seater SUV after that, which will give a new momentum to its UV sales. At the same time, Hyundai is expected to get into the MUV segment with a new product early next year, and that may further increase its UV sales,” he said.
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