KIA TO HAVE A DIFFERENT INDIA STRATEGY: HYUNDAI MD
Ahead of the entry of Kia Motors in the Indian market, its sister company and India’s second-largest car maker Hyundai Motor India Ltd said both companies will have separate strategies to aggressively compete with each other.
“Kia and Hyundai will be different. Management, operations and network... Everything will be different. Vendors can be shared for cost reduction, but strategy will be different,” said YK Koo, MD of Hyundai India. “We will be aggressive against Kia. They are a competition.”
He added it will not be easy for Kia to make inroads in India since the market has changed. “I think they will invest from the beginning. Since 1997-98, the auto industry has changed a lot. Now, the competition is very tough. Almost 19 players... To set up a factory is okay since people have money, but to survive and continue the success is different.”
Reuters on February 7 first reported that Kia is likely to choose a site for its factory in Andhra Pradesh’s Ananthapur district. The Economic Times newspaper on April 17 said Kia’s investments in Andhra Pradesh could be ₹10,000 crore. Mint could not verify these independently.
Hyundai, however, is not worried. “Already 19 players are here. If that becomes 20 or 21, it does not make a lot of difference,” Koo said, who was also the part of the original team that set up Hyundai’s operations in India.
“Kia is not same as Hyundai. Their DNA is different. They have a different sales and marketing strategy,” he said. “Product line-up also could be different.”
Hyundai’s Indian business is the third-largest contributor to the company’s revenue after its home market and China, and in 2013, accounted for 14.5% of global sales. Hyundai has invested $3 billion in India so far.
Hyundai India is planning to invest ₹5000 crore as it looks to double its sales in India to 1 million units by 2021. It also plans to introduce eight models by 2020.
The company plans to sell 6,82,000 units in 2017-18 and aims to maintain its market share, which stood at 17% during the fiscal ended 31 March.