Hyundai bets on diesel to narrow gap with Maruti

MARUTI SUZUKI INDIA WILL STOP OFFERING DIESEL VEHICLES FROM APR 1 IN LINE WITH THE IMPLEMENTATION OF BS-VI EMISSION NORMS

NEWDELHI: Hyundai Motor India Ltd, the country’s second-largest carmaker, is betting on diesel vehicles to narrow the sales gap with market leader Maruti Suzuki India Ltd, which will stop offering diesel vehicles from 1 April in line with the implementation of stringent Bharat Stage VI (BS-VI) emission norms.

Despite its more than two decade-long presence, Hyundai is yet to mount a serious challenge to the market dominance of the Suzuki Motor Corp. unit in India. Maruti has been able to control about half of the domestic market due to a slew of fuel-efficient and affordable compact cars.

This may change after the introduction of BS VI norms as Suzuki has announced plans to cease production of diesel cars due to the high costs of developing them.

The Hamamatsu-based manufacturer is instead betting on compressed natural gas (CNG) vehicles.

Hyundai, on the other hand, has invested significantly in small diesel engines and is expected to price its offerings aggressively to hold on to customers inclined towards diesel vehicles.

SS Kim, managing director and chief executive of Hyundai Motor India, said that as long as prices of diesel vehicles remain affordable and acceptable for the customer, there will be significant demand. He said the company’s product offerings with diesel engines will be reasonably priced and that research and development as well as procurement teams are working towards reducing the cost.

“If diesel vehicles meet the BS VI regulation, I strongly believe that it is a very good solution in terms of fuel efficiency. In this segment (sedan), Maruti used to get 30-40% of the total volumes from diesel. For (the) time being, Maruti does not have plans to continue in diesel vehicle (space),” Kim said.

Hyundai on Tuesday launched its new compact sedan Aura, with a 1.2 litre BS VI compliant diesel as well as two petrol engines—1.0 litre and 1.2 litre—at the ex-showroom price range of ₹5.79-9.03 lakh. The Aura is Hyundai’s second and most ambitious attempt to wrest control of the segment from Maruti’s Dzire model.