Hyundai and Kia produced 1 million in India by 2022

In 2022, Hyundai produced about 7,00,000 vehicles, while its sibling Kia produced 3,40,000.

Hyundai Motor Company (HMC) has reached a key milestone by producing more than a million units annually in India for the first time, following closely behind its claim to be the third largest automaker in the world.

Highlights

• Nearly 23% of the market is accounted for by Hyundai and Kia jointly.

• SUVs account for more than half of Hyundai's sales.

• A significant impact was capacity utilisation rates of over 90%.

Hyundai is only the second carmaker, after Maruti Suzuki to reach the manufacturing milestone of one million (10 lakh) units in a calendar year, along with its sister brand Kia.

Currently, Hyundai and Kia together account for close to 23% of India's passenger vehicle sales, each owning 15.45% of the market. The Korean siblings' record-breaking sales for the year were mostly made possible by their faster production rates.

Currently, over 15% of the brands' entire global output comes from India. It is also one of their top three or four production facilities worldwide, serving not only the expanding domestic market but also important export markets in Latin America, the Middle East, and Africa.

Hyundai records its biggest domestic sales ever

The combined manufacturing facilities of Hyundai and Kia are expected to produce between 1.02 and 1.04 million vehicles annually, a 20 percent increase over 2021's output and the highest annual production volume for Hyundai in India to date.By the end of 2022, Kia India will have produced 3,40,000 vehicles, compared to 7,00,000 for Hyundai Motor India.

Hyundai Motor India's Tarun Garg, director of sales and marketing, stated, "We will sell our highest-ever domestic yearly volumes in 2022, registering an increase of over 9% over 2021. Hyundai's growth momentum is still being driven by SUVs, which represent more than half of our overall volume.

With a hard-charging Tata Motors right behind it, Kia has posted over 40% growth in volumes in 2022, while Hyundai Motor India has been working hard to cling on to its number 2 spot in the passenger car market.The Carens MPV has generated strong additional revenue for Kia in 2022, even as the Sonet and Seltos SUVs continue to dominate their respective segments.

According to Myung-sik Sohn, CSO at Kia India, the firm reported very excellent sales results in 2022 and increased capacity to handle increased demand as a result of improved customer mood and pent-up demand.

Growing Demand of SUVs

According to worldwide trends, the Indian passenger vehicle industry is benefiting greatly from the ongoing surge in demand for UVs and SUVs, which is growing by a high double-digit rate of almost 30%.Therefore, it is not unexpected that over 50% of Hyundai's sales are comprised of SUVs. Hyundai recorded its best-ever annual sales in 2022 of 5,52,511 units (up 9.4%). Its best-selling item, the Creta, brought in $1,40,895 and made up 25.50 percent of all sales last year.

Similar to how Toyota has benefited from an SUV-focused portfolio, so has Kia. In addition to selecting SUVs as the target market, it also made sure that the range of goods it created for India had a strong design DNA and was loaded with features and technology that were not yet available in India at a very reasonable price.Offering a truly wide variety of engine, gearbox, and feature options was the key to Kia's market success. The company even integrated some of the most cutting-edge technologies from the premium and luxury markets into more affordable SUVs.

Unsurprisingly, Kia reached half a million sales in India the quickest. Three years after operations began, in July 2022, it surpassed the 5,000,001 sales threshold.

The formula used by Hyundai and Kia, which includes aggressively sweating assets with capacity utilisation rates of over 90% and using the base for exports to achieve considerable economies of scale, has been successful. To guarantee high utilisation rates, the corporation has wisely reallocated capacity over time, either to the home market or exports.

Maintaining expansion will require new business models

Due to additional sales generated by new models, Kia has been growing faster than the market overall, however Hyundai Motor India has suffered a drop in market share. Garg explains that Hyundai holds a 19 percent market share in the areas in which it operates. The brand does not, however, participate in a fifth of the market and is absent from the entry-level vehicle, micro-SUV, and MPV segments.Garg says, "We will continue to move where the customer is heading," declining to discuss new product plans or the possibility of closing this gap. As we continue to research the market, certain holes might be addressed and others might not. New models, however, can aid in increasing market share.

To deliver additional volumes, the company will rely on the newest Verna (BN7i) and the brand-new micro-SUV (codenamed Ai3 CUV). In the meantime, Kia will shortly release mid-life improvements for the SUVs Seltos and Sonet.

Auto Expo 2023 will feature Hyundai and Kia

This year, Hyundai will concentrate on electric vehicles and autonomous driving technology at the upcoming Auto Expo 2023. At the ceremony, Hyundai will likely reveal the Indian prices for its flagship vehicle, the Ioniq 5. The Ioniq 6 electric vehicle will also be on display from the firm. Although Hyundai hasn't confirmed anything, the company might display a different concept that serves as a sneak peek at its upcoming sub-compact SUV, which will go on sale in the second half of 2023.

The EV9 flagship SUV will be displayed by Kia as its star offering. Other Kia exhibits at the forthcoming Auto Expo include the Sorento three-row SUV and the newest Carnival MPV.

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