How and why Hyundai plans to grow the i20 Active segment in India

With the just launched i20 Active hatchback, Hyundai Motor India has become the newest entrant in the segment of hatchbacks with a distinct sporty character. The others in the segment are Volkswagen (Polo Cross), Toyota (Etios Cross) and Fiat (Avventura).

At Rs 6.7 lakh for the entry level petrol variant and a diesel version which ranges from Rs 8 lakh to Rs 9.3 lakh (ex-showroom, Mumbai), the i20 Active has a premium price positioning. This move by Hyundai to enter a segment that sells only around 1,000 units a month is a contrast to its business approach of entering any segment "that has volume and is growing". But Hyundai's senior vice-president (sales and marketing) Rakesh Srivastava says in a confident note, "We would be able to bring in growth (in the segment) many times." He believes that the i20 Elite and the i20 Active could together contribute to 14,000-15,000 units a month.

The i20 Elite, with average monthly sales of over 8,000 units since its launch in August 2014, is Hyundai's best-selling model in India. But selling in a segment which has seen few takers could be challenging. Srivastava points out that Hyundai has a customer base of over 3.5 million people in India, many of whom could be looking at an option like the i20 Active, to buy. This could also be giving Srivastava the strong confidence to be able to grow the segment.

Hyundai sees the i20 Active segment, where models offer an SUV-like character, also as a step for customers to enter the SUV segment. At the other end of the band, Hyundai has the Santa Fe premium SUV. A new SUV is expected to plug the gap in between by this year's festive season. These steps will be key for Hyundai to reach its target of a 17.2 percent market share in the Indian passenger vehicle market during 2015-16 from 16.2 percent this year.

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