Outside of Korea, India marched past China in 2021 to become Hyundai’s largest market in the world where retailed cars are produced within the country. The achievement comes less than four years after India was made into regional headquarters by Hyundai that provided for more functional autonomy.
India kept the global lead in the January to March quarter as well with sales coming the closest ever to sales in Korea, Hyundai’s home market which is also its biggest.
Hyundai Motor India (HMI), the 100 percent subsidiary of Hyundai Motor Company (HMC), clocked domestic sales of 505,033 units in 2021 while the joint venture Beijing-Hyundai Motor Company (BHMC), saw sales of 350,277 units during the same year, as per data disclosed by HMC. Until 2020, China was HMC’s biggest market outside Korea for locally produced cars.
While the US is the biggest international market for Hyundai, more than half of the country’s sales come from cars that are not made locally as they are imported. The company has a plant in the US also but it produces and sells less than half the total sales clocked by HMC in that country.
Demand outpaces growth
For Hyundai, demand from India outpaced the growth the auto major saw in each of the global markets last year. HMI sales in 2021 grew 19 percent compared to 423,642 sales clocked in 2020. The Chinese market slumped 20 percent in 2021 to 350,277 units compared to 2020.
“The market has shifted from ‘small is beautiful’ to ‘big is better’ concept with growing affinity towards SUVs,” said an analyst tracking India’s automotive market.
Creta, highest selling
Hyundai introduced two new SUVs in India, Creta and Alcazar in 2020-21 and will follow this up with a launch of new Tucson SUV later this year. Creta is the highest selling model for Hyundai.
Suzuki, Hyundai winners
India now has the distinction of being the biggest market with local production for Suzuki Motor Corporation and Hyundai Motor Company. The two companies control 60 percent of India’s passenger vehicle market.
Exits from India
India gaining significance for Suzuki (Maruti Suzuki) and Hyundai comes amid a series of exits of automotive brands from the country with the latest being Nissan-owned Datsun. Ford, General Motors (Chevrolet) and Fiat have been the other brands and companies to have exited India in the last five years.
Backlog
Car makers, including Maruti Suzuki and Hyundai have struggled to keep pace with demand because of shortage of semiconductors. The car industry is estimated to be sitting on a backlog of 7,50,000 orders which is equivalent to three months of sales.