Hyundai Motor Co., South Korea's largest carmaker, said Friday that it seeks to move "up market" in India this year, while expanding sales of its popular mini-sized city cars.
The carmaker is already the second-largest automotive nameplate on the subcontinent with its market share topping a little over 15 percent with around 380,000 vehicles sold in 2013.
The Indian car industry as a whole is dominated by Maruti Suzuki, a subsidiary of Japan's Suzuki Motor Corp. that held a 43 percent market share last year.
"Hyundai does well in the small city car sector with the Grand i10 selling more than 30,000 units since it went on sale late last year, but the goal is to move into larger segments such as compacts and subcompacts," a corporate source said. The Grand i10 was named the 2014 Indian Car of the Year last month.
Such a move will improve profits and raise the value of the brand among Indian consumers. It can also allow diversification that can offset, to some extent, unexpected fluctuations in the car market. Last year, Hyundai sales fell 2.9 percent from the year before, the first annual contraction in sales numbers since the company entered the market in 1996.
He pointed out that the company is well positioned to expand into larger cars since it already makes such vehicles, such as the Elantra compact and Verna subcompact in the country.
"We sold around 4,800 Elantra's last year," the source said, hinting that there is room to increase sales.
Hyundai's India operations can churn out 600,000 cars annually, with quite a bit being exported to foreign markets such as Europe.
The source, who declined to give details ahead of Hyundai's conference call set for next week, said that besides pushing to sell larger-sized cars, the company plans to tighten its grip on sales of popular mini models. In addition to the Grand i10, Hyundai makes the EON, Santro and the i20, which are just below the Verna in size.
The company said efforts are underway to appeal more to younger customers in their 20s and 30s.
People in these age groups are likely to be first-time car buyers or may be urban professionals who may want larger cars. To reach out to customers, the company may expand its dealership network in the new year.
The source, however, said that with extremely small volume sales of the mid-size cars such as the Sonata, Hyundai is not really looking into the idea of trying to enter the premium and luxury markets.
"If there is demand, we can export cars like the Equus and Genesis to India, yet this is not high up on the agenda at the moment," he said.
Hyundai, meanwhile, said its 2013 global sales expanded 7.3 percent from a year earlier despite sluggish global economic conditions.
It said total sales hit 4,721,156, up from 4,401,946 units tallied for the whole of 2012. For 2014, the company hopes to sell 4.9 million cars worldwide. (Yonhap News)