How Kia and MG Motor managed to buck the great auto bust

According to the latest data from the Society of Indian Automobile Manufacturers (Siam), Kia captured 6.23 per cent of the utility vehicle (UV) segment in four months and MG managed to gain 2.20 per cent of the market since its June launch.

T E Narasimhan reports.

The past year has been bleak for India's automobile industry with carmakers voicing concerns over their future, jobs being hit, and dealers shutting shops. Two foreign manufacturers still decided to try their luck.

South Korea's Kia Motors entered the country towards the end of the year in August with its sports utility vehicle (SUV) Seltos while British brand Morris Garages (MG) Motors started selling the Hector, another SUV, in June.

And, their gamble paid off. According to the latest data from the Society of Indian Automobile Manufacturers (Siam), Kia captured 6.23 per cent of the utility vehicle (UV) segment in four months and MG managed to gain 2.20 per cent of the market since its June launch.

Kookhyun Shim, managing director and chief executive, Kia Motors India, said: "We have witnessed a huge demand for Seltos in India and the love for brand Kia grows continuously."

He expects the company's India story to get better with the launch of the Carnival this year.

Rakesh Sidana, director (sales), MG Motor India, said the sales momentum of Hector in India has been very encouraging as a new entrant.

"We are working closely with our global and local suppliers to increase the production of the Hector in 2020 to support the booking backlog. We are setting up more service centres closer to our prospective customers to elevate their ownership experience with MG."

Passenger car sales declined by 23.59 per cent in the first nine months of 2019-20, however, the UV segment saw a growth of 6.35 per cent, according to the Siam data.

In the overall passenger vehicle segment, Kia managed to grab 2.14 per cent and MG grabbed 0.75 per cent of the market.

All other auto companies in the UV segment saw their market share and sales drop -- except for Hyundai and Renault, who bucked the trend on the back of some launches.

According to estimates, the UV segment is expected to touch 1.5 million units by 2023.

Total domestic UV sales during April to December rose to 725,563 from 682,257 a year ago. Exports rose to 133,511 from 120,134 units.

Renault grew its market share in the UV segment to 4.39 per cent in 2019-20 from 1.64 per cent last year, with 186 per cent growth in terms of volume to 31,853 units from 11,163 units during the period.

The volumes were driven by the new Triber, Kwid and Duster.

Venkatram Mamillapalle, country CEO and MD, Renault India, said the company plans to accelerate production to enable faster deliveries.

"The company has seen acceptance in rural markets and plans are to expand across these markets."