[GTO]

When Hyundai entered India in the late 90s, they wanted to become the no.1. That's all that BVR Subbu and gang would talk about. That was also a period when Maruti was particularly weak due to its complacency & fights between the govt & Suzuki. Since, I think Hyundai has resigned itself to being a happy no.2. Kia will definitely improve the group's overall market-share, but in the short or even mid-term, it is far-fetched to think they will match Maruti. Long-term? Who knows. But do keep in mind that Maruti has consistently remained the no.1 for 35 years now.

This question is as much about Hyundai-Kia's progress as it is about Maruti making wrong decisions. Of late, the latter hasn't happened at all. In fact, Maruti has gone from strength to strength (products, distribution, new launches, features, even engines) and now has big daddy Toyota on its side of the table.

[Chetan_Rao]

Originally Posted by GTO

...
This question is as much about Hyundai-Kia's progress as it is about Maruti making wrong decisions. Of late, the latter hasn't happened at all. In fact, Maruti has gone from strength to strength (products, distribution, new launches, features, even engines) and now has big daddy Toyota on its side of the table.

Counter-perspective:

Maruti did mess up their BS6 diesel transition, and Toyota seem to have no intention of increasing their segment footprint in India and are a rather conservative, risk-averse organization.

Both are now also facing competition in segments they've traditionally 'owned' outright.

You're right they may stay #1 for the foreseeable future, but they've both also demonstrated a lack of nimbleness w.r.t. competition. The only thing missing was products people would compare with and buy above a Maruti/Toyota car, that also isn't the case anymore.

Interesting times

[Fuldagap]

Although Hyundai is definitely a formidable competitor to Maruti Suzuki in India, becoming no.1 is a distant dream for Hyundai Kia as far as India is concerned IMHO.

Maruti has an extremely loyal base not only in customers but also in the dealer network and the vendors.
Cars manufactured by Maruti are rugged, cheap, low maintenance, practical, reliable, high mileage and have an x factor that appeals to the Indian customer like none other. S presso is an ugly car IMHO but it's selling like hot cakes, something appealed to the customer.

In the times when Mahindra 'jeeps', Ambassador, Fiats used to rule the roads, nobody would have thought that a light weight, weak looking and seemingly unsafe car, the 800, would topple the market upside down. It was just the beginning of the Maruti chapter in the country. People still call Maruti cars as 'sabun ki dabbi' etc but also go ahead and buy those cars because they are the epitome when it comes to VFM products. Maruti has been consistently delivering win-win situations for all stakeholders with almost negligible products as failures for any stakeholder. They had the Omni for the small trader, they also sold the mountain goat to the Army, which also was a darling of enthusiasts and still is. All the other cars in between, cater to those stratas of customers which no other company has been able to tap or give service to.

The after sales network is strongest, most widespread and customers are less likely to be cheated compared to other brands. When a customer runs a Maruti for 10 years flawlessly, it speaks volumes about the product quality and the loyalty of the customer. Also peace of mind is a big contributing factor in this.

Three questions that I have are:
1. Does Hyundai make cars or atleast one car in the country that even remotely appeals to die hard car enthusiasts?
2. In which other country is Hyundai no.1 in terms of sales?
3. What does it take to reach levels of VFM that Maruti cars offer the customer with?
4. I have one more question, how much involvement at the top levels of management of both the car manufacturers compare, which one has more Indians involved in marketing, sales, manufacturing, supply chain, vendor management and HR?

[skchettry]

I believe Maruti had a distinct advantage of technology and therefore was successful in kicking out Ambassador and Padmini from the Indian roads. Hyundai has been around for a pretty long time but it could not spread its wings the way Maruti did. Although I find both Hyundai and Kia have technical and commercial strong points, for both of them to dislodge Maruti in the next 5-10 years is not possible; Maruti has dug too deep into India.

[evoker]

I think it is possible to get close but not close enough. Maruti without diesels will be a golden opportunity for Hyundai+Kia to increase their market share. There are almost no diesels in the lower end and they should make use of this seeing that most volumes lie here.

[kiku007]

The actual question is, where will the Indian economy be in the next 5-10 years?

IF the Indian economy ever consistently and truthfully has the growth that China or S.Korea had, then there's a possibility of companies like Hyundai and KIA becoming the number one manufacturer because Maruti by itself doesn't have the product portfolio or vision to cater to such an aspirational population. They are always dependant on their Japanese big brothers for help. The South Koreans, on the other hand, are hungry for market share and will be quick to fill the gap in the market.

Unfortunately, as things stand I don't see any possibility of the above happening in the immediate future. Who knows beyond that?

In the late 90s and 2000s there was a lot of talk about how India is going to be one of the biggest markets for automakers and many global carmakers set shop in India. Look at the situation now. Either they have shut shop or massively scaled down their ambitions. It's almost back to square one so to speak.

[pannags]

Originally Posted by GRAND23

As I said earlier, I personally would want Hyundai/Kia to lead the Indian market as No.1 manufacturer in coming years. Let me know what other BHPians think.

The Seltos did take the market by storm! Kia got everything about the Seltos right - combination of engines and transmissions to suit everyone's preference, loaded to the brim with features, a neutral likeable overall design, and most importantly, responding to market feedback like no one else had done in recent times. Kia has indeed arrived big and will aggressively pursue steps to increase their footprint. They may perhaps be able to repeat this with other upcoming models, but this will be far from sufficient to capture the kind of market share Maruti has.

At the lower end of the spectrum, the Maruti story is more about catering - rather than competing - to a segment of the market that comprises of, say, a family looking to move from a risky two wheeler to a small car that gives them a sense of safety and status or a small business that needs to deliver consignments within the perimeter of a town etc. Essentially, products that are perceived as functional, accessible, economic, easy to run, maintain and fix.

Then comes the mid segment where cost-aspirations balance comes to play. The typical buyer here is looking for a successful car with above average safety, must have bells and whistles with attractive modern designs. With the kind of reputation Maruti enjoys for after sales service and hassle free ownership, lack of variety in engine or transmission combinations seldom matters, and neither does the fact that every third car on the road is the same model and make.

Now, the above segments are avenues where the volumes game comes to play, and who other than Maruti knows the tricks of the trade better.

When we move to the upper mid segment – C2, D1, D2 – the buyer is more discrete, and is looking for top of the line features, updated safety, power on tap etc., and is willing to pay a premium to acquire them. I believe NEXA was created to cater to this segment, but Maruti simply hasn’t had the will to up the ante here, although by no means one can say they haven't tasted success. Their recently announced BS6 engines don’t really wow, neither does the fact that they have no exciting launches lined up for the immediate future.

Here is where newcomers like Kia and VW (dare I say) are likely to make an impact rather than at the lower end of the pyramid. And this, by no means, is going to be able to generate the kind of numbers that are required to unsettle the current leader.

On the other hand, if Maruti goes aggressive and lines up the likes of the Vitara and S-Cross with more powerful contemporary engines and better gearboxes - which are already pretty much available elsewhere, we are only likely to see further consolidation - and it's not as if they've not surprised us in the past, what to speak of new products in the works.

For the time being though, and perhaps next few years, I don't see how anyone can unsettle their leadership position in market share terms.

[GRAND23]

The current situation of Maruti Suzuki is reactive not proactive. For example, a recent launch S-Presso was to bring looks similar to Kwid. Also, no diesel engines from Suzuki stable and lack of safety features. As a market leader, a trend should be set by Suzuki. Instead, it is now following or modifying the cars to match the trend set by someone.

Going by Maruti's agility, I still couldn't understand why they didn't bring competitor for Creta. The profit in C2 segments should have attracted Suzuki long back. Instead, they launched S-Cross 1.6, which is now discontinued. The question remains is, will big daddy Toyota help Suzuki to enter in C2 segments?

Note: I am not biased to Hyundai/Kia cars. This thread was started to understand the future growth between Hyundai and Suzuki.

[pavanmadhini]

Let me give another take on the whole "aspirational" element. I strongly agree that car buyers are aspirational in nature, and that is precisely why Maruti will cede both Market Share and revenue share to Hyundai/Kia.

Let's look at the highest selling cars every month - Alto isn't even in the top 3 anymore. Dzire is the volume king now, followed by Baleno and Swift. The highest selling price point is inching up. Infact, if we take Seltos + Creta, Hyundai/Kia are selling as many Urban SUVs as the Dzires Maruti is selling.

In the next 5 years time, I'm willing to bet that the top selling model in the country will be in the 12-15 lakh price range. And that price range will further increase in 10 years time. And I am not sure Maruti can compete in those price ranges. Maybe Toyota can, if they get serious about India, but not Maruti.

So, yes, I do think Hyundai/Kia can go to 35-40% market share in next 5-10 years once Kia's line-up gets more fleshed out. If Kia can have 5% market share with 1 car, I'm sure they'll get to 15% within 5 years. And in terms of revenue share, they'll be laughing all the way to the bank.

[gasinveins]

Originally Posted by pganapathy

I don't think Hyundai/Kia can manage unless they start manufacturing cheaper cars. Yes, they had the Eon, but otherwise the i10/Santro is the cheapest one now. Maruti still has the Alto and Omni which sell decent numbers. No doubt their single best-selling model is the Swift, but their cheaper car volumes are quite huge.

Maruthi sells Omni still? I don't think so. They discontinued the model.

[Swap_Abarth]

To me, answer is no. MSIL knows this market better than anyone else. They are market leaders for so long. And I am sure, their management would have long term strategy in place to retain the leadership. With partnership with Toyota, they will have new products (hybrid and EVs) to maintain/increase the current volumes.
Hyundai & Kia are doing great. They definatly have very able workforce. With entry of Kia, market share has increased. But not with substantial cannibalization from MSIL. They will definatly increse the markt share in next 5 years. But I don't see them at poll position anytime soon.

[laser2707]

IMO Hyundai/ Kia should not attempt to be Numero Uno. In the Indian Auto context, it means selling "Value Engineered" metal boxes. Kia has shown the rest of the OEM's what it means to be an aspirational brand. They should stick to this strategy. What they will forego in Market Share they will gain in Brand Equity.

We desperately need desirable automobiles & an aspirational brand marketing them. For too long OEM's like Maruti have taken Indian car buyers for granted. Kia's success should be a wake-up call. There are car buyers out there but not enough good models for them to spend on.

[VVN]

I personally wouldn't want any OEM to command 50% market share. It allows them to cheapen out without worrying about the repercussions. I would want healthy competition between 6-7 OEMs with no one commanding 50% share.

[maxbhp]

Originally Posted by GRAND23

When I say No.1, I mean market share. Currently Suzuki has 53% share of Indian market and followed by Hyundai with 16% and Kia is about 5.8%. For parent Hyundai company, it’s almost 22% market share. I sense Hyundai/Kia jointly can put more share number, say close to 50% and above in next 5-10 years. I know it is not going to be easy, but definitely not impossible. Suzuki is not going to handover crown so easily and will be interesting to see what is their upcoming strategy to defend Kia/Hyundai.

While its a good thought remember that Maruti has reached the numero uno position with a carefully spawned strategy of adding products like sandwich and ensuring production capacity to augment the plan. This is not an easy task considering the initial investment required in terms expansion of plant, machinery, man power, vendor base, distribution network, managing A.S.S. needed for every new model being added. While Hyundai is growing very well, I doubt Maruti will sit and relax too long. Am not fan of Maruti but interms of ability to service the Indian consumer market, they have to be respected. Hyundai sure has tons of money to invest and even in terms of technology frame of EV they may have the upper hand w.r.t Maruti but its really not easy to gauge what really the mass wants.

Originally Posted by GRAND23

As I said earlier, I personally would want Hyundai/Kia to lead the Indian market as No.1 manufacturer in coming years. Let me know what other BHPians think.

I hope one of the Indian manufacturer turns into a global marque. Mahindra & TVS definitely has the intent. Hope they align their belief and resource towards creating world class products.

[sri_tesla]

Can Hyundai/Kia become the No. 1 car manufacturer in India in the next decade?
Yes.

Can Hyundai/Kia grad 50% market share?
No.

What Maruti is able to achieve in terms of growth and market share is commendable, despite so many large brands entering the market in the last 2 decades. But I don't think they will be able to maintain the same market share for another decade because of the following reasons.

• The next decade will be all about EVs and Maruti has no presence and they don't even have a proper roadmap. Parent Suzuki also has no proper roadmap for EVs.

• Maruti is so much behind even the home brands like Tata and Mahindra in the EV space. They continue to concentrate on the market share and short term profits and ignore the technology transformation happening across the world.

• Maruti's failure to grab the Rs 10+ lakh market.

• Entry of Chinese brands. They may not be successful in petrol/diesel sales but they will definitely grab some market with EVs.