Hyundai looks to boost output to a record this year
NEW DELHI: Hyundai Motor Group plans to manufacture as many as 1 million vehicles in India across its two brands— Hyundai and Kia—in 2021, two people aware of the plans said, as it bets on a sales rebound thanks to the faster-than-expected economic recovery.
The South Korean conglomerate plans to make 700,000 or more vehicles under the Hyundai brand and 250,000-290,000 units under the Kia brand, the people cited above said on condition of anonymity. If these targets are realized, it will be the highest annual production for the Hyundai group in India and may help it extend its lead over Maruti Suzuki India Ltd in the fast-growing SUV segment.
Automakers are bullish about sales as the economic recovery gathers steam and the Covid-19 vaccines boost consumer sentiment, one of the two people cited above said, adding almost 30% of the output may be exported.
“At the same time, the preference for personal mobility is likely to remain for some time. Hence, most of them have guided for robust growth in production, almost touching the level of 2018-19 or more. Auto industry executives initially thought a minimum of three years will be needed to reach the 2018 level, but now it seems recovery will be faster,” the person added.
Email queries sent to Hyundai Motor India and Kia Motors India last Monday remained
unanswered. Maruti Suzuki, has also asked its suppliers to prepare for a record 2 million output in FY22. Hyundai introduced the Kia brand in India in August 2019, as part of its strategy to sell vehicles through two brands and increase its market share in India. The strategy worked and sales of its compact and mid-size SUVS Sonet and Seltos zoomed. Kia is also expected to launch a multi-purpose vehicle to rival Maruti Suzuki’s Ertiga.
If the forecasts stand, Kia will be able to utilize the entire capacity of its Andhra Pradesh factory in 2021. Its management, though, had targeted this in 2020 itself, after its products found resounding success.
In the nine months to December, Hyundai and Kia, which have a shared ownership structure, together commanded 35.95% share of the SUV market, while Suzuki had 22.4%, according to data from Siam.