Hyundai Motor India Limited focuses on rural market as it completes 2 decades of operation

As Korean car-maker Hyundai's Indian arm Hyundai Motor India Limited (HMIL) completed 20 years in the county on Friday, May 6, 2016, a company spokesperson told International Business Times, India, that, among the many things India's second-largest car-manufacturer plans to do now is put a lot of focus on the rural market. 

HMIL, which laid the foundation for its factory in the country on May 6, 1996, and began operations on September 1998 by commissioning its first integrated car-manufacturing plant outside Korea in Sriperumbudur near Chennai, plans to deepen its network across India — especially in the rural markets — with more channel partners across the board, the spokesperson told IBTimes India. "We want them to get the same level of service as is given in the big towns," he said. 

HMIL at present has a hub-and-spoke architecture in place for its network, which means that for every big dealership in a big town, there are smaller outlets at rural areas surrounding it, said the spokesperson. "We also have 'Hyundai champions' — educated and influential people who help us get the word across about our products," he said, adding that the word-of-mouth from this activity — one among many that Hyundai apparently conducts at the panchayat and tehsil levels — helps generate sales. "We want the people there to know we are their lifetime partners," he told IBTimes India. 

"We also have tie-ups with rural banks that help people avail car loans as per special schemes linked to their crops," he said, adding that small cars like Hyundai Eon, Xcent and Grand i10 are preferred in these parts. 

The rural sales make up for around 20 percent of the company's sales in India, and the spokesperson told IBTimes India that HMIL sees this sector playing a very big role in the future.

The HMIL growth story

The Santro hatchback was the company's first offering in India, instantly became so successful that the car-maker continued its production till last year. HMIL's portfolio has increased over the year and now consists of 10 models spread across the hatchback, sedan and SUV segments. HMIL also boasted of 17.5 percent market share in FY2016, behind the leader Maruti Suzuki.

HMIL is also the largest car-exporter in India. Exports started in 1999 from India with just 20 units, and has now touched 23 lakh units cumulatively, reports Business Standard. HMIL also contributes nearly 13 percent to Hyundai's global volumes.

"This is a very important milestone for us. 20 years ago we only had a dream of transforming the Indian auto industry by introducing contemporary products and today that dream has come true. We were also the first proponents of 'Make in India' and showcasing India's manufacturing prowess to the world. That vision is validated with HMIL and India remaining at the heart of HMC's global operations and a key hub for exports," YK Koo, MD and CEO of HMIL, said in a statement.

The car-maker now plans to launch two new products every year in addition to more digital showrooms, automated workshops and sponsorships.