Financial Daily from THE HINDU group of publications
Saturday, Nov 27, 2004
Financial Daily from THE HINDU group of publications Saturday, Nov 27, 2004 |
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Corporate
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Announcements Marketing - Strategy Hyundai drops prices of Elantra Our Bureau
Bangalore , Nov. 26 HYUNDAI seems to have perfected into a fine art the practice of dropping prices for a limited period on its models. This time round, it has reduced the price of its latest model — Elantra by over Rs 1 lakh and the offer will be open for seven days. Early this month, Hyundai reduced the price of Santro to Rs 3.01 lakh for three days and last December, it reduced the price of Accent to Rs 5 lakh for a limited period. Company officials claim that these offers are tagged to the company achieving significant milestones but auto analysts say that these limited period offers are basically to make up for extremely poor sales between April and June when Hyundai faced production problems. A Hyundai official pointed out that it took Hyundai Motor nearly five years to sell five lakh cars in India and just a year to sell two lakh cars more. Hence, to celebrate the occasion of having sold 7 lakh cars in 70 months, it has decided to offer Elantra for Rs 7.6 lakh ex-showroom (basic version), around Rs 1.3 lakh less than its earlier price tag while the top end version will cost around Rs 8.3 lakh, nearly Rs 1.7 lakh less. The CRDi will cost Rs 9.93 lakh, nearly Rs 80,000 less than the earlier price. All Elantra models are fitted with Antri-brake locking system (ABS) and Tracation Control System (TCS). The official said in spite of adverse reports, Elantra's sales have in fact been as per the target. He said for the first 12 months of its launch, Elantra was expected to sell around 6,000 units or 4,800 units till the end of 2004. It has been selling at a steady 500 units per month. "We are happy with the sales. There is no issue there," the official said. But after these price reductions, Hyundai is all set to increase the price of all its models between 2 per cent and 3 per cent. During the three-day period when Santro was on sale for a price tag of Rs 3.01 lakh, Hyundai was able to sell as much as 27,000 units, with most of the sales happening on the last day while Accent sold around 6,000 units during the limited period offer which was at a price of Rs 5 lakh. The official said Hyundai expects to close the year with sales of 2.1 lakh units, around 40 per cent higher than 2003. Its exports during the entire year are expected to be around 70,000 units, around 133 per cent more than 2003. Hyundai has also been able to resolve the production issues and will now be able to manufacture around 21,000 units per month from next year onwards.
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