By Jhoo Dong-chan
Hyundai Motor is now focusing on its luxury and performance divisions, introducing the Genesis brand as part of the carmaker’s efforts to diversify its sales portfolio. But the nation’s top carmaker is also enjoying surging sales in emerging markets by reducing the size of its models.
Hyundai Motor’s small-sized vehicle trio _ the Creta subcompact crossover SUV, i10 and Eon city car _ are strategic models sold exclusively in the Indian market. They have been well received by consumers there for their differentiated quality through the carmaker’s “frugal innovation.”
Frugal innovation is the process of reducing the complexity and cost of a good and its production by removing unnecessary functions from the product when a company enters into less developed countries. The localization process is often effective at the low-end market of advanced countries.
A Hyundai Motor official said, however, the three models are not just about affordable prices so much as they are about strategic models tailored to satisfy the needs of Indian motorists.
“Due to high tariffs on imported products in India, Hyundai Motor built its own production plants in the country and has produced vehicle models to please their Indian customers,” he said.
“Hyundai developed the three models after intensive studies of India’s traffic environment and conveniences for drivers there. The vehicles are affordable, but at the same time, their quality is reliable.”
Third parties also endorse Hyundai’s claims.
According to the J.D. Power 2016 India Initial Quality Study, the three models topped the list in respective segments. As a result, Hyundai Motor could win out in the authoritative survey.
The study measures problems that owners experience with new vehicles during the first 30 months of ownership and examines more than 200 subcategories in eight vehicle categories. The eight are engine and transmission, driving experience, air conditioning, vehicle exterior, features, controls/displays, vehicle interior, audio, entertainment/navigation and seats.
All problems are summarized as the number of problems per 100 vehicles (PP100), with a lower score indicating a lower incidence of problems and higher initial quality.
In the entry compact segment, the Hyundai Eon got 96 PP100 to share the top position with the Suzuki Murati Alto 800. The Hyundai i10 also topped the compact segment with 64 PP100. And the Hyundai Creta SUV, which debuted there in 2015, ranked highest in the SUV segment with 68 PP100.
The Creta was also named India’s Car of the Year in 2016 by selling more than 80,000 that year. It was also the best-selling SUV in the Indian market.
“We put forth our best efforts to meet varying demands of our clients around the world whether they are about premium vehicles or compact cars,” the Hyundai official said. “We will continue to come up with innovative models with local relevance not only in India but also in other countries.”
Last year, Hyundai’s sales amounted to 4.86 million while those of its sister brand Kia Motors stood at 3.02 million.
Through boosting its marketing efforts and rolling out new models, the two carmakers strive to achieve combined sales of 8.25 million this year.