The Covid-19 pandemic and the nationwide lockdown hit the automobile industry hard, as demand slumped and companies were forced to suspend operations in much of April and May. Hyundai Motor India, however, is not stepping off the gas. India’s second largest carmaker launched four products this year, and the second generation Creta SUV, launched just before the lockdown in March, received some 70,000 bookings in five months.
S.S. Kim, managing director and CEO of Hyundai Motor India, says the pandemic has not altered the company’s plans and it will invest Rs5,000 crore in the next few years. Excerpts from an exclusive interview:
July data suggest that vehicle sales are on the cusp of getting back to normal. Some experts, however, say it is because of the pent-up demand. What is your opinion?
In July 2020, the Indian auto industry reached 80 per cent of the monthly average of calendar year 2019. However, Hyundai did better than the industry by reaching 90 per cent of monthly average of 2019 with over 38,000 units in the domestic market, marking an achievement of nearly 98 per cent of last year’s corresponding sales numbers. Post the unlock period, we have witnessed the demand for automobiles picking up gradually as personal mobility is gaining traction. The demand was more from tier 2 and tier 3 cities than metropolitan markets due to low spread rate of pandemic.
In the past four months, digital consumption has increased across platforms. Our Click To Buy digital sales platform saw good customer response. Hyundai is also offering customers its 360-degree digital service and contactless service experience through the Hyundai Care app, WhatsApp, website or a call to dealers.
Indian auto sector was battling a slowdown even before Covid-19 hit. Is India’s auto market geared up for a quick revival?
Last year, the Indian automotive sector witnessed uncertainty and slowdown due to factors such as transition from BS IV to BS VI emissions and revised banking norms. However, the growth of motorisation is progressing positively in India, the potential buyers per thousand population is still lower than the US and Europe. In the current situation, we are introducing new technologies, connected features and advanced powertrains to excite and surprise our customers. I would like to add that despite this challenging situation we have launched eight new products in India.
How do you intend to keep the leadership in SUVs?
Hyundai India has contributed strongly in the utility vehicle segment with four super performer SUVs—the Creta, the Venue, the Tucson and the Kona Electric—registering sales of 34,212 units (April-July, 2020). With the five lakh sales mark, the Creta has set yet another benchmark in the industry. The new Creta has received over 70,000 bookings in 5 months.
Hyundai is offering customers a wide array of highly efficient and powerful powertrain options. The contribution of diesel in the new Creta bookings continues to soar and is now at 60 per cent. The BS VI diesel technology is primarily preferred by the Indian customers for its power delivery, driving pleasure, fuel efficiency and lower emissions.
India has been one of the largest markets for Hyundai. In a post Covid-19 world, are things going to change?
India is an extremely important market for Hyundai. We have a long-term product roadmap for the domestic market and we will abide by these plans and continue launching exciting products for our valued customers. Our focus is towards introducing safety and health features benefitting our customers. Additionally, we are enhancing our product offerings with a renewed emphasis on connectivity and product differentiation through our technological prowess.
What are the key pillars that will help Hyundai’s sales, even as Covid-19-related uncertainties are likely to continue for some time?
Our first priority is to resolve customer anxiety in this challenging environment. Under the ambit of Hyundai Cares, we have introduced multiple financial schemes to enhance customer confidence through programs such as EMI Assurance and associations with banks to offer unique customer centric car finance schemes. Hyundai was the first company to enter subscription space in 2019 to mitigate the financial burden of customers offering peace of mind. We have witnessed an increase in interest from customers towards our offering in subscription model. This is on account of increased need towards personal and safe mobility without owning a car. Additionally, Click To Buy has pioneered online car buying with an end-to-end solution offering customers the ability to purchase cars online and even get loans through a single platform without the need to visit dealerships.
Over the next 3-5 years, what will be the key focus areas you will be investing in?
We are deeply committed to the country and have a strong line-up of future products for the customers. Regardless of this pandemic, we will continue with our investment plan of 05,000 crore for India as committed in 2019. We want to continue being the preferred brand for the customers, offering them smart mobility solutions through product differentiation with our technological prowess.
There has been a lot of talk on EVs gaining momentum. Based on the experience with Kona, will we see more EVs being rolled out by Hyundai?
Hyundai Kona is India’s first full range electric SUV that has received tremendous response and created a perception change about the concept of EVs in India by addressing concerns and myths about charging and range anxiety. We are committed to meeting the needs of today’s urban and progressive customers and are fully aligned with the government on its vision of steering in an electric vehicle culture in India. With our experience of introducing the Kona Electric and its overwhelming acceptance in India, we are now working towards bringing-in new affordable electric technology for our future customers.