The compact sports utility vehicle segment has been driving the volumes of the SUV segment for past two years with several launches and competitive pricing. However, for quite sometime, launches have dried up in this segment. With the launch of Hyundai’s new SUV Creta on Tuesday, the segment is set to see some vibrancy again.
According to Hyundai, the pre-booking for Creta reached 10,000 across the country which is probably a record in the utility vehicles segment. According to experts, Hyundai will likely price the product between Rs 9 and 10 lakh. The vehicle will be available in both petrol and diesel variants, which will help Hyundai cater to a significant size of the SUV market in the rural areas as well.
The compact SUV space was looking for a new product as sales of the existing products, like Ford Ecosport and Renault Duster, plummeted to a large extent. In May, volumes of duster fell to 1,429 units. Hyundai Creta could provide a fresh lease of life to the compact utility vehicles segment and the extremely high pre-booking is an indication of the expectation the customers have from the company.
Rakesh Srivastava, senior vice-president, marketing and sales, Hyundai India, said the Creta will help the SUV segment grow. “The pre-bookings have reached 10,000 and we will also start an advertisement campaign in television once the product is launched. When we launched the Elite i20, we sold 10,000 units in the first 20 days,” Srivastava added.
The SUV segment in India will receive a much-needed boost from the Creta as the volumes in June fell 5.86% to 41,278 units. In last 3-4 years, the compact SUV segment has grown 30-40% compared with 15% growth of the overall utility vehicle market. Puneet Gupta, associate director, IHS automotive, said that the Creta has been able to catch consumer fancy even before the launch. Their rolling launch tactics have kept them in news continuously for last few weeks and Hyundai has been successful in building up a huge excitement around its new product.
“With the Creta launch, undoubtedly the compact SUV segment is set to expand in India. Even other players like Ford, Renault and Mahindra present in the segment should get the benefit and have an excellent opportunity to grab a bigger volume in the swelling segment,” added Gupta. According to industry experts, if Hyundai manages to price it above the existing products in the segment, a part of the customers who have pre booked the Creta may switch to Duster or Ecosport which will help expand the segment.
Abdul Majeed, partner, PricewaterhouseCoopers, said the enthusiasm is reflected in the pre-booking numbers but the final verdict will be out only in 5-6 months. “The economic condition in India is subdued, as a result customers will buy a product only when they see real value in it. In the past, we have a seen a particular product performing well when the industry as whole was not performing and the pricing has to be competitive. Cutting across segments only new products will drive volumes.