Hyundai to take fight to Mahindra in SUV market
Hyundai is confident that its latest Alcazar will replicate the performance of Creta
After its runaway success with entry-level and mid-size sport utility vehicles (SUVs), South Korea’s Hyundai Motor Co. is planning to disrupt the bigger six- and seven-seater SUV sub-segment, traditionally dominated by Mahindra and Mahindra Ltd, with its latest product Alcazar.
Despite being a leader in the overall SUV segment, Hyundai has not yet registered any success with its premium offerings like Santa Fe and Tucson and the latest offering, if successful, will help the company tap into a new set of customers.
Competition in the bigger SUV segment, though, is expected to intensify this year, as market leader Mahindra is set to launch the new version of its popular product, Scorpio and new vehicle XUV 700 to protect its ground. The company’s new management led by Anish Shah has also made it clear that it will only focus on ‘True Blue’ SUVs rather than smaller ones to gain market share.
Hyundai though is confident that Alcazar will replicate the performance of Creta in 2015 and will create a niche in the market.
According to Tarun Garg, director, sales, marketing and service, Hyundai Motor India, customers are now aware that Hyundai is the number one SUV manufacturer in India and they like the designs and technology offered by the company. Hyundai also plans to tap into the existing customer base of Creta customers and upgrade some of them to the Alcazar.
“Before launching a product Hyundai always conducts market research and then tries to create a segment and this has been there since its first product Santro. With the Creta also in 2015, the company has managed to create a separate segment. That’s why we are quite hopeful and confident. Today, the numbers may not look very high in the segment (bigger SUVs), but given the feedback we have received, we are confident of creating a market,” added Garg.
With the introduction of its smallest SUV, Venue in 2019 and second generation of mid-size SUV, Creta, in 2020, Hyundai managed to eclipse Maruti Suzuki India Ltd and Mahindra and Mahindra Ltd to become the leading manufacturer of such vehicles. According to experts though these are not proper SUVs and are mostly suitable for emerging markets like India where people want vehicles with SUV like design since many of them cannot afford a proper SUV.
Besides Mahindra, new entrant MG Motor India has also managed to carve out a niche itself with its product Hector and retail sales of the product crossed the 4500 unit mark in March, indicating the demand for such offerings in the market.
According to Garg, Hyundai has sold 71,530 units of SUVs in the January to March quarter of 2021 and the second largest player sold 54,585 units and SUVs now form 45.8% of Hyundai’s total sales in India. The company now plans to extend the leadership in the segment with Alcazar.
“If you see the range of SUVs that Hyundai has today, then, we have five products, and they are all very different. We have the Kona electric SUV, then the Venue in the sub 4 metre segment and the Creta, which has been a trend setter. In the last two months Tucson, also has been selling around 150- 170 units although it’s a very niche segment,” he added.