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Old 21st February 2020, 12:55   #31
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Default Re: Can Hyundai / Kia become the no.1 car manufacturer of India?

Simple answer is NO. Maruti knows the pulse of "average" indian car buyer and nails that segment single handedly. As a result the volumes keep coming in. Despite of being bashed for creating tin cans they come up with facelift Dzire which is better in all aspects that the outgoing one except for having a thinner metal sheet this time and a lighter kerb weight. And how does buyers respond? By making it the best seller!! Maruti knows that though awareness around safety is increasing day by day the number of folks who still are happy with 2 airbags are far more.

Secondly it has a very strong brand value in tier 2-3 cities/rural areas. During any car buying conversations in my native village in Uttar Pradesh I cannot just speak about Ford, Kia, Tata or Hyundai. If I do I am just out rightly ignored.
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Old 21st February 2020, 13:59   #32
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Default Re: Can Hyundai / Kia become the no.1 car manufacturer of India?

Thanks guys. It's wonderful to see some different perspectives.

Some posts say that there should not be one manufacturer leading 50% sales chart and some posts say Suzuki market share will only continue to grow because of Toyota. It's interesting to understand what changes happens in market if one car manufacturer starts leading 60%+ sales. Let' say Suzuki/Toyota increases it's market share beyond 60-70 percent, what changes might happen in market? Will it create monopoly?
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Old 21st February 2020, 14:56   #33
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Default Re: Can Hyundai / Kia become the no.1 car manufacturer of India?

I don't think so. MUL would not capitulate and its customers would not abandon. It has a strong loyal base which no other car maker has. Sure, it's market share may dip to 42-43 % but no lesser than that. MUL is very strong in hatchbacks and hatchbacks are increasingly being bought in petrol since deregulation of diesel prices and resulting narrowing down of fuel price difference AND also since this 10 year diesel rule which gives 5 extra years to petrol cars. Right now 10-15 year rule is only in Delhi but other state customers fear it may come to them, too, someday. The biggest loss to MUL would be Dzire diesel cab market which just evaporated. I am sure Brezza and S-Cross may not take big hit because of hybrid petrol's increased mileage which may take running costs closer to diesels. Diesels are strong in SUVs/MUVs. But small car buyer doesn't mind if FE is taken closer to diesels's.

Kia has no hatchbacks and no under-10L car. Not sure if they would enter budget-end of motoring. Hyundai has but they had to contend with a distant second spot. Not sure if presence of diesels would take them past MUL.

And, what is this Toyota-will-pull-MUL-out-of-this-morass thing? Toyota themselves are a 2-car company. Innova and Fortuner. Far cry in price and size from what MUL makes. Don't quite understand how Toyota will help Suzuki. They pulled the plug on their own Etioses/Liva (right?) and are currently selling/planning to sell more re-badged Suzukis. Beats me how they can help Suzuki. Their expertise lies in MUVs/SUVs. Not hatchbacks.
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Old 21st February 2020, 16:53   #34
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Default Re: Can Hyundai / Kia become the no.1 car manufacturer of India?

I see a lot of BHPians compare Maruti with that of Kia and Hyundai on who should take the first position. Let me be very honest, people from rural areas and 70's 80's generation are still biased on choosing their 4 wheeler which is Maruti and there is no denying on that.

I am not supporting Maruti (and I don't own any of the car(s) of that brand). Their build quality is pathetic, yet they have a very good spares availability. To be precise, for every con of theirs has an equal pro and hence Maruti is surviving all these years.

Now we need to accept the fact that Maruti, Kia and Hyundai aren't the only automobile manufacturers in India, we also have Mahindra and Tata (Indian Make).

These days Mahindra and Tata both are producing super tank like cars and they are not compromising on build quality.

Mahindra - Marazzo - NCAP rating 4
Mahindra - XUV300 - NCAP rating 5
Tata - Altroz - NCAP rating 5
Tata - Nexon - NCAP rating 5

The aforesaid cars are proven in safety and reliability also. People are also thinking about Make In India.

I think more than Kia, Mahindra and Tata has more chances to prove as number 1 taking into consideration their age, reliability and performance.

Last edited by Chetan_Rao : 21st February 2020 at 21:08. Reason: Removed political reference.
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Old 21st February 2020, 16:59   #35
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Default Re: Can Hyundai / Kia become the no.1 car manufacturer of India?

As far as ICEs are concerned it seems unlikely, however if they focus more on EVs (BEV, FCEVs) and time, wind (since Maruti is reluctant consider launching even EVs on trial bases) and policies turn right for them, they can surely be no. 1 in next 10-15 years if not now.
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Old 21st February 2020, 17:22   #36
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Default Re: Can Hyundai / Kia become the no.1 car manufacturer of India?

Wow! That's ambitious! But I liked the optimism. I wouldn't say it's not possible but wouldn't be a cake walk for sure.

Kia/Hyundai have a long, long way to go to set up a network like MS have. India is a massive country with majority of population living in rural and suburban areas. MS are so strong with their network in such areas. I have lived in remote mountains. And I can tell you that majority of cars there are MS, Mahindra utilities and a few Tatas as well.

Why there's no competition to MS in such areas:

1. Easy access to authorized service stations and mechanics. There's no point in buying a Kia when I have to take it 250 kms every time when its service is due.

2. Their cars including Mahindras have been extremely reliable and have proven the test of time.

There's a great urbanisation happening at an extremely fast rate. But we can't overlook the fact the majority of population resides in rural and suburban areas where MS is a king, like literally.
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Old 21st February 2020, 18:50   #37
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Default Re: Can Hyundai / Kia become the no.1 car manufacturer of India?

NO!!

The then Hyundai CEO Y.K. KOO said in 2017, they cannot compete with maruti in volumes. We had a thread on it :

https://www.team-bhp.com/forum/india...onslaught.html (Hyundai seeks own space amid Maruti Suzuki’s onslaught)

I personally feel, instead of taking on Maruti, Hyundai will continue to offer premium products and see fat margin.
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Old 21st February 2020, 19:35   #38
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Default Re: Can Hyundai / Kia become the no.1 car manufacturer of India?

NO!

It's a huge aspiration. To dream about getting to No 1, they have to make the general public forget, the existence of the name - "Maruti" Not Suzuki. It has become a household name when it comes to car just like Xerox for copier.
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Old 21st February 2020, 22:50   #39
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Default Re: Can Hyundai / Kia become the no.1 car manufacturer of India?

Yes

Here's how...

SAIC and others from that side of the Himalayas set up shop here and start eating away market share at both the entry level and the Million Rupees and over car market.

As the country gets richer, the average Indian starts buying a CSUV as a first car. The way Suzuki has been operating all these years, they would probably still be selling the Brezza with some more stickers. It is quite possible that a Tata or a Ford-Mahindra or some other manufacturers CSUV could be leading the sales charts by then.

EVs get heavily subsidised leading to higher adoption. EVs aren't much of a Suzuki strong point, and Suzuki is somewhat lazy about it too...

Suzuki sticks to its current strategy of letting others create opportunities before it goes and captures the market. This may have worked for them so far, it is unlikely to work out in the future given that it may take quite some more time to get the technology in place. More importantly, new technologies/regulations could push the costs of cars up to such an extent that buyers start finding other brands which offer more snob value a better proposition.

In the midst of all this change, Hyundai+Kia could just snatch the leadership from Suzuki. They just have to keep doing what they are doing now and keep getting better.

Improbable? Looks that way to me too, but remember the time when HM and PAL ruled our market? At that time no one could have predicted the extinction of those two icons of yesteryears. Interesting times!

Last edited by vik99 : 21st February 2020 at 22:58. Reason: Added details.
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Old 22nd February 2020, 08:49   #40
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Default Re: Can Hyundai / Kia become the no.1 car manufacturer of India?

Quote:
Originally Posted by kiku007 View Post
The actual question is, where will the Indian economy be in the next 5-10 years?
I don't understand this doom and gloom over what is a cyclical degrowth (not even recession) that is not just impacting India but countries around the world.

And India has grown to be one of the largest auto markets in the world and still broadly speaking continues to grow. From iirc the 12th largest in 1991 to the 4th largest now, on track to become the 3rd largest by 2021, even assuming lower levels of growth, this will happen by 2022-23.

I fail to see how having the 4th / 3rd largest auto market is not large, what are the standards for "large"?

On the automakers who left, I won't blame the economy but on themselves. They didn't understand the market and lost the game. Tomorrow if Nissan or Honda exit, would you blame the market or Nissan and Honda for utterly misreading the market?
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Old 22nd February 2020, 14:38   #41
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Default Re: Can Hyundai / Kia become the no.1 car manufacturer of India?

The Answer is No and honestly Kia/Hyundai shouldnt also aim for it.
The various reasons I could think of:

1) MSIL has a greater presence in rural areas. The name is Trust. And still in various B cities, Maruti is only synonymous with 800.
It willtake a Hyundai leave alone Kia to reach the wide spread households.

2) Maruti is also associated with "Tin Cans". To achieve market share, Kia/Hyundai has to look at a differentiation. LET SAFETY BE THAT DIFFERENTIATION. . And to achieve that, you do not use low tensile steel and lower costs. You focus on a robust frame and build upon it.

3) Good Products priced with sensibility.
Kia/Hyundai needs to focus on good products and price then sensibly and aspirationally. Do not compete on the numbers game. Get in the Soul/Sportage/Sorento and keep them Safe and Aspirational.

Having Said that, Kia certainly have the potential to expand market share to upto 35% and that should be the aim.

No. 1 is just a no. which does not mean that you are the Best.
Its better to be a No. 2 that the No. 1 aspires to be!!
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Old 22nd February 2020, 18:25   #42
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Default Re: Can Hyundai / Kia become the no.1 car manufacturer of India?

To be frank trying to beat Maruti in India would be foolish, even as a long term strategy. Trying to get into areas not covered by Maruti would be a better idea. Suzuki does not have too many models in mid and bigger size even in foreign markets, wherein the Hyundai/Kia combination can really cash in on.

As I have noticed in the past 2 decades, people start off their 4 wheeler buying life with a Maruti, probably for the first one or two cars (No offence to Maruti loyalists). But once they shift to a foreign brand very few even think of returning to Maruti, in spite of their Nexa models. This speaks volumes about quality of vehicles in the mass market

Last edited by vb-san : 22nd February 2020 at 18:27. Reason: Typo corrected
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Old 23rd February 2020, 01:04   #43
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Default Re: Can Hyundai / Kia become the no.1 car manufacturer of India?

Well, here are some of my thoughts:

Safety:
I don't think safer cars will be a reason for Hyundai overtaking Maruti Suzuki. MS is not selling safer cars because the customers are still buying unsafe ones, what happens when they stop buying ? Maruti easily ups their game and re-launches those cars with 5-star crash ratings, then what ?? Moreover, in this premium compact car segment, I am yet to see how Hyundai's cars fare. Last time I remember they pasted 'safest car' sticker on their i20 back in 2011-12 when the India made car got just 3 stars in 2018 !

Quality:
Quality of products can be one reason where Hyundai can overtake Maruti (and it has succeeded in upper segments), but when it comes to cost conscious buyers, that is something they can choose to compromise as long as it gives them peace of mind in other aspects like service, cost of ownership, availability of spare parts etc. Can Hyundai can match their levels ? Certainly.

Some comments mention that Maruti's quality is pathetic, but its actually not, its just about 'acceptable' for general public and that is what matters to them. The one thing Maruti has perfected over the years is mastering the 800cc, 1000cc and 1200cc engines. Their quality/reliability is unmatched and has developed great levels of trust. Hyundai has been playing around with their 800cc (Eon now discontinued),1.0, 1.1l 3 cylinder, 1.1l 4 cylinder, 1.3l, 1.2 and 1.4 and 1.5l engines. That is a lot of experiments (which must have cost them a lot of money). Not relevant for future, but just an indicator on the approach of both companies getting their basics right.

Product placement:
Maruti launched a 7 seater MPV Ertiga made it even better in the next iteration. Secondly, Maruti continues with their cheapest cars 'enabling' a switch from two wheelers to four wheelers for the common man. Hyundai discontinues their cheapest car: Eon. That is one of the biggest factor for deciding market share. There is always going to be a person buying a car instead of a 2 wheeler as soon as he can afford one. And he is not going to buy an expensive car. The market for Commercial vehicles using MPV's and boxy cars like WagonR is always going to be there. Does Hyundai/Kia have any plans to tap both markets in near future ?
Premium cars to compete with Seltos/Creta: Toyota can bring in their better products here, but as long they are minting money with Fortuner and Innova, they won't bother until it reaches alarming levels. They know very well that if they launch something slightly better than the competition at a competitive price, masses are going to lap it up, simply because people associate Toyota with trust and reliability. Its a different matter that they haven't priced their products well compared to competition (Yaris, Corolla), but its a pure numbers' game for them. Their failed cars in India are doing good elsewhere plus their margins are pretty high. Lets see how Kia Carnival shakes Toyota Innova and we will know for sure if Toyota is starting to lose it. Compact SUV segment is one where Maruti has lost for now. They simply dont have a good product matching Creta, Seltos. But that alone wont help Hyundai take over Maruti.

Hybrid/EV:
Agree they dont have much right now, but with Toyota sitting on piles of cash, don't think it will be so hard for them to enter into EV market. Then, coupled with Maruti's legendary after sales service network and quality of service, they can match up with the competition in few years. Take for example the Brezza: Compact SUV segment was being ruled by Ecosport at one point. How many quarters did it take for Maruti to overtake Ecosport numbers ? that too with just a diesel engine. To summarize, they might be late to enter the EV race, but when they get rolling, how is one going to stop them ? Is Hyundai rapidly expanding their network to match up with Marutis ? Because with EV switch, its the same existing showrooms and service centers that will cater to these cars.

Off-topic: I honestly want Tata to overtake Maruti in terms of everything. They have superior products compared to Maruti (Tiago has got 4 star safety rating), are tapping into all segments right from small hatchback to 20 lakh rupees SUV and have started selling EVs too
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Old 23rd February 2020, 10:21   #44
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Default Re: Can Hyundai / Kia become the no.1 car manufacturer of India?

Hyundai-Kia becoming no. 1 might be possible but only when the majority of the car buyers start buying cars >10 lakh rupees.

While they seem like competitors, Maruti-Suzuki & Hyundai-Kia have distinct brand identities. For example, Hyundai-Kia will never pull off a low budget car like the alto while Maruti can never pull off a Creta-Seltos rival. So, while Hyundai-Kia can never compete with Maruti on sales, they still can compete with them on revenues. People won't and probably will never accept a >15 lakh Maruti while they already accept Hyundai-Kia cars at this price range.
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Old 24th February 2020, 06:52   #45
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Default Re: Can Hyundai / Kia become the no.1 car manufacturer of India?

Quote:
Originally Posted by Stribog View Post
I don't understand this doom and gloom over what is a cyclical degrowth (not even recession) that is not just impacting India but countries around the world.
“Cyclical degrowth (not even recession)” – That’s a nice term, I guess. It’ll be very useful for the next couple of years at the minimum.


The OP asked if Hyundai/KIA can ever become the No.1 Car manufacturer in India and I think that’s possible IF more people can afford cars like the Seltos.


Check for data that include GDP, Per-capita income and car ownership data from India, China and South Korea for the past three decades. Based on the history, current situation and the forecast, I don't think there’s going to be explosive growth and subsequent demand for cars like the Seltos in the next five years. Beyond that, I don’t know. If you think otherwise then I’d love to hear how and why. Is it because the "Cyclical degrowth" will self-heal itself?

Quote:
Originally Posted by Stribog View Post
On the automakers who left, I won't blame the economy but on themselves. They didn't understand the market and lost the game. Tomorrow if Nissan or Honda exit, would you blame the market or Nissan and Honda for utterly misreading the market?
Sure yeah, companies like GM, Nissan and Honda do deserve brickbats for their performance. Markets like India and China have always been challenging for global automakers. The learning curve was steep. They poured money if they thought there was light at the end of the tunnel. But that's not happening anymore, is it?
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