Hyundai sees Creta reviving growth in compact SUV segment in India

Hyundai Motor India Ltd (HMIL) launched its Creta compact SUV in New Delhi today. The Creta, equipped with a first-in-class, six-speed automatic transmission in the diesel variant, is based on Hyundai’s fluidic sculpture 2.0 design philosophy that marks its i20 and Verna models.

The Creta gets dual powertrains – the 1.6-litre Gamma Dual VTVT petrol engine and the 1.6L U2 CRDi VGT (MT/AT) and 1.4L U2 CRDi diesel motors at an introductory price starting at Rs 859,558 lakh for the base L version and Rs 946,939 for the base 1.4-litre diesel edition and going up to Rs 13,60,156 lakh for the SX (o) diesel variant. The diesel AT version is priced at Rs 13,57,770 (all prices, ex-showroom Delhi). HMIL expects the diesel variant to account for 75 percent of the Creta’s sales.

The Creta, like all Hyundais in India, has a high localisation level of 90 percent with some components like the automatic transmission and some parts of the manual transmission still being imported.

The new SUV is designed with a strong hive structure body shell that, according to Hyundai, offers structural strength, stability and sturdiness. The ring-shaped frames applied at the B-pillar, C-pillar and engine bay help achieve high body rigidity, improved durability and crash performance. The ring frame structure also enables a significant increase in body stiffness that contributes to more precise handling while maintaining high ride quality.

Inside the cabin, a next-generation infotainment system provides connectivity for all gadgets and devices with the multimedia system having the 7^th audio video navigation with 6 speakers. There’s also the option of a 5-inch touch-screen audio system that features aux-in, iPod, USB, MP3, CD, Bluetooth support with 1GB memory.

Advanced sound absorption materials, engineering design of the engine, transmission and body structural parts have reduced the NVH performance and made the Creta cabin quieter. Safety kit includes 6 airbags, ABS, electronic stability control, and hill start assist control.

HMIL claims it is the first vehicle OEM in India to offer a 3-year, unlimited kilometres warranty on the Creta SUV which delivers an ARAI-certified 15.29kpl (petrol), 19.67kpl (1.6 MT petrol) and 17.01kpl (AT petrol). The 1.4-litre diesel delivers 21.38kpl.

CRETA PRODUTION PLAN
It is learnt that the Creta has already received 15,000 confirmed bookings and 41,000 customer enquiries in the past three weeks. HMIL plans to produce 5,500 units of the new SUV each month at its Sriperumbudur plant, with provision to ramp up capacity to 7,000 units depending on market demand. This means the vehicle is likely to have a waiting period of around 2 months to start with, even though HMIL will make the SUV available at dealerships immediately. HMIL currently has 425 dealers and more than 1,100 service points across India.

NEW COMPACT SUV & MPV PLANNED
Meanwhile, B S Seo, managing director and CEO, HMIL, confirmed that Hyundai is also working on a sub-4-metre compact SUV as well as an MPV among the new models planned for India. “We have invested Rs 1,000 crore on the new SUV (Creta) project and are targeting the domestic market initially,” he said.

Riding on domestic demand for the Creta, Hyundai is targeting growth of around 16.7 percent in FY2015-16 with sales of around 480,000 units compared to 420,668 units (+10.63%) in FY2014-15. Though the initial focus is the domestic market, HMIL will be exporting around 12,000 Cretas to Latin America, Africa, South East Asia and the Middle East this fiscal. Last year Hyundai exported 191,221 units (+20.08%); however, hitting this figure in FY2015-16 may pose a challenge due to the slowdown in key global markets.

HMIL is going all out to drive sales of the Creta which it believes will help revive growth in the compact SUV segment. Rakesh Srivastava, senior VP (sales and marketing), is bullish that the Creta, which is pitched against the Nissan Terrano and Renault Duster, will drive up volumes and growth in the SUV market, both for the industry and for Hyundai.

The compact SUV market in India is estimated at 12,000 units per month and pegged to be growing at a CAGR of 25 percent on a 2011 base. However, the past six months have seen a decline but the segment is expected to grow with a host of new product launches and the upcoming festive season.

Seo says that the company’s two plants with a combined capacity of 640,000 units are adequate to meet current production needs of the new models including the Creta. Full capacity utilisation will be reached sometime this year, and can be scaled up to 700,000 units. HMIL is awaiting progress on the Land Acquisition Bill, GST Bill and legislation on labour reforms before firming up plans for a third plant in India.