Car wars in flux | autos | Hindustan Times
Today in New Delhi, India
Dec 04, 2016-Sunday
-°C
New Delhi
  • Humidity
    -
  • Wind
    -

Car wars in flux

autos Updated: Jan 04, 2011 01:39 IST
Sumant Banerji
Sumant Banerji
Hindustan Times
Highlight Story

At a time when global car majors like Toyota, Honda and Volkswagen are trying to make a mark in the domestic small-car segment and loosen the vice-like grip of market-leaders Maruti and Hyundai, the Big Two of the domestic auto industry plan to launch pricey premium cars this year. At the same time, they will try to maintain their lead in the small car space.

Market-leader Maruti Suzuki India Ltd will launch at least two big cars this year — a diesel version of the SX4, and the Kizashi. The latter, at R16-18 lakh, will be its most expensive car in India till date.

Rival Hyundai has promised three launches this year — two of which could be mid-size sedans like the Avante (successor to the Elantra) and the new Verna. This at a time when Toyota and Honda are set to attack their positions with small-car offerings Etios Liva and Brio respectively.

“The Kizashi is a very important car for us not because we expect huge sales from it but it will be a very good learning for the company,” said Mayank Pareek, managing executive officer, MSIL. “Right now, we know the pulse of the consumers in the small car space and understand the segment. But we want to know what clicks in the premium car space as we know those segments will invariably become important in future.”

Between them, Maruti and Hyundai sell three out of every four small cars sold in the country. Put in the Tatas, and less than 14% of the market is left for the other eight players. The small- and mini-car segments account for nearly 80% of the total car market (see graphic). At present, the premium-end of the car market is ruled by Honda, Toyota, GM and Czech carmaker Skoda. Though Hyundai is present in this segment, its share has been miniscule.

“Unlike Suzuki, which is known globally as a small carmaker, Hyundai has proven credentials as a big carmaker as well and the Elantra is the largest selling car in China,” said H W Park, managing director and CEO, Hyundai Motor India Ltd. "We have not given up on the premium car space and very soon we will bring in our entire line up of cars."

Hyundai’s global portfolio includes as many as 6 sedans but only two — Accent/Verna and Sonata — are offered in India. The first to hit the roads would be the Avante, that will compete with the Toyota Corolla Altis and Honda Civic. The success of the two companies in the small car space has however not rubbed off on their bigger cars. Maruti scored a dud with the now extinct Baleno while the SX4, after the initial hype, is a distinct Number 2 to Honda City.

Similarly, Hyundai has tasted failures with the Elantra (which had to be discontinued) and the Sonata, and has had and only partial success with the Verna. “The mindset of customers is different in India and they are more demanding when it comes to the premium end of the car market,” said Abdul Majeed, principal consultant, PriceWaterHouse Coopers. “The product should be relevant vis a vis competition and needs to be upgraded from time to time,” he said.