Getz line may move out from Korea to India

Hyundai is exploring the option of shifting production of the Getz model from Korea to India, according to reports in the Korean press. While this is not exactly a surprising development given the obvious advantages India has to offer, it remains to be seen when this will actually happen. Hyundai had, a few years ago, shifted production of the Atos Prime to India and had indicated that other models could follow if found viable.

There have been reports doing the rounds that the company is looking at exports of nearly 20,000 Getz models every month eventually. The domestic market is not expected to account for more than 5,000 units if the present offtake of 1,500 cars each month is any indication. Hyundai’s exports have been growing at a rapid pace and tipped to touch 50 percent of output in the next couple of years. Once production of the Getz also shifts to India, the percentage of exports could even overtake domestic consumption. Whether this is a model that is acceptable to the company is a moot point.

This always becomes a difficult decision because profitability eventually holds the key to growth. Hyundai would also look at tapping the advantages of India which include its strong vendor network and lower costs instead of merely trying to build market share. This also possibly explains why it is not as formidable as what it was some years ago.

The Getz was launched with much fanfare a couple of years ago but has not been able to do the kind of numbers that its rival, the Suzuki Swift has been notching up every month. Dealers say the relatively higher price tag is a deterrent but company officials reiterate that the volumes are in line with expectations because of tight production schedules at the plant.

India has increasingly emerged as an important global hub for small cars. In a few months from now, it is set to overtake Japan as Suzuki’s largest manufacturer. Recently, Nissan and Suzuki announced their intent to produce compact cars for the world market in India. This could only be an indication of bigger things to come in the future.