New Hyundai Santro launch on October 23; six reasons why company feels it will be winner again

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New Delhi | October 20, 2018 2:01 AM

How this toad-shaped car—the brand was positioned as Sunshine Car to attract reluctant buyers—became one of India’s best-selling cars and then drove into sunset. Now, it rises again.

cars, auto sector, auto industryClockwise, from top left: The new Santro (codenamed AH2), and the first and second generation models.

Globally, it was called Hyundai Atos. When this tall car with a short bonnet and a vertical back was launched in India on September 23, 1998, Hyundai chose the name Santro—taken from Saint-Tropez, the French city famous for fashion—because the company wanted to project it as a ‘fashionable’ new car. It was the first uniquely-designed small car that was not a Maruti (Fiat had launched the forgettable Uno in 1996), and it appealed to customers. Even though the Santro faced tough competition (Maruti Zen), sales took off—it was a time of economic upsurge; the passenger vehicle segment saw 56% growth in sales during 1999-2000. Within two years, Hyundai was selling about 6,000 units of the Santro every month.

On May 8, 2000, the company launched Santro zipDrive—power steering in an entry-level car—and on July 11, 2001, the new-look Santro arrived. Soon, on September 6, 2002, the Santro got an automatic transmission unit.

But with Maruti upping the game with the Wagon R (launched in 1999 with a 1061cc petrol engine), the Santro (999cc) needed more power. On March 18, 2002, the car got the 1086cc Epsilon engine, and on May 22, 2003, the Santro Xing was launched (it was a global car, developed for the global markets).

Sales shot up and, by 2006, the Santro was clocking sales of 20,000 units every month (to put that in perspective, Maruti sells almost similar numbers of the Dzire today, in what is a far bigger industry).

Upgrades kept coming—Santro Xing with eRLX tech in 2005, Santro CNG in 2007 and dual-fuel Santro Eco in 2008.

However, post the 2006 peak (2,40,801 units), sales started tapering. One of the reasons was the Santro got cannibalised by the modern i10, launched in 2007. From a high of 2,33,909 units sold in 2007, sales dropped to 1,30,898 units in 2008 (44% drop), and later to 30,500 units in 2014. Apart from the i10, the company started focusing on the Eon, launched in 2011.

On January 15, 2015, Hyundai discontinued the car. YK Koo, the current MD & CEO, attributes the reason to “end of product life cycle.” Another reason was that, by 2015, Hyundai had embraced the Fluidic Sculpture design philosophy for all its cars and the Santro looked out of place. “It was a tough decision (discontinuing the car). Since we had embraced the new design philosophy across segments, we needed to bring the same elements in the Santro,” says Koo, “which we have now developed.”

It is also argued that if the entry-level Eon was selling well, perhaps there was no need to develop the AH2 (the codename of the new Santro). Koo disagrees. “The Santro fills the gap between the Eon and Grand i10, and has a different customer base,” he says. (The i10 was discontinued in March 2017, so the new Santro essentially replaces that model, according to Koo.)

And Hyundai is very confident about the success of the car. “One, the strong DNA and the legacy of the brand lives on. Two, it will be a ‘value purchase’ in its segment with premium features. Three, it’s got the modern tallboy design—based on what we call ‘rhythmical tension’ theme. Four, it’s packed with features such as segment-first 17.64-cm touchscreen, smartphone connectivity, voice recognition, rear parking camera, and so on. Five, the car has a spacious and comfortable cabin with rear AC vents. Six, customers have a choice—1.1-litre petrol engine with an AMT and a factory-fitted CNG option,” Koo adds.

For quite some time, Hyundai has shied away from AMT gearbox technology; even said on a few occasions that it believes in offering only the full automatic gearbox. Koo says that during market research it was found there is a huge demand for AMT in the compact segment. “Not only is the AMT technology more economical, it provides ease of driving especially in the city stop-and-go traffic conditions, and convenient ergonomics,” he says.

Going forward, Koo is optimistic about the success of the car that will be launched on October 23. “The Santro is a loved brand with a heritage. It was the first spacious tallboy design, first car to comply with Euro 3 emission norms and the first with MPFI engine in its class. The mid-compact segment is growing and we needed a ‘strong’ product to fill the demand, where the new Santro perfectly fits,” he adds.

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