Companies

Our product strategy is based on relevance in India: Kia Motors’ Tae-Jin Park

V Rishi Kumar Hyderabad | Updated on December 25, 2020

Tae-Jin Park, Executive Director and Chief Sales Officer, Kia Motors India

Within 15 months of the launch of Seltos SUV, Kia Motors India has added three significant models in its portfolio. In a short span, it has grown to be among the top four auto makers in terms of sales during 2020 with a market share of about 6 per cent in the passenger car market.

As it steers itself through the Covid pandemic-hit world into 2021, it expects to see the growth momentum continuing with preparations for third shift. This is likely to ease up the current waitlist backlog, and possibly aid in launch of a new model.

Tae-Jin Park, Executive Director and Chief Sales Officer, Kia Motors India, in an exclusive interaction with Business Line shares how the Korean automotive has managed to be on track with its India plans in spite of Covid induced disruption. Edited excerpts:

 

It has been over a year since Kia rolled out the Seltos from your Anantapur plant. How has the journey been so far?

It has been an excellent run for us. Globally, Kia has always been admired and awarded for its unique designs and quality products and we aim to continue building on that equity in India as well. In just over one year of operation, Kia has emerged as one of the best-selling brands in India and has already been steady on the list of top five auto manufacturers in the country. We have launched three segment-leading products, which have garnered tremendous response from customers. With our products, we have disrupted the mid-SUV and compact-SUV segments and created huge demand with the Seltos and the Sonet — and created a whole new segment with the Carnival.

We have achieved a number of milestones in a short span. Till date, we have sold 1,74,000 vehicles, becoming the fastest carmaker to achieve 1,50,000-sales figures in the country. Our first product for the country, Seltos, has surpassed the 1,00,000-sales mark and has acquired almost 40 per cent segment share since its launch. Our most recent product, the Sonet, has bagged the crown of being the highest selling compact SUV in the country and is enjoying a 20 per cent segment share in just three months of its launch. Not only this, but the Sonet is also among the list of 10 most selling vehicles in November 2020. In addition, we have also sold more than 1,00,000 connected cars. We achieved these milestones when the industry was witnessing one of the worst slowdowns in the Indian automotive history and the consumer sentiment was at an all-time low due to the Covid-19 crisis.

 

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We have received an overwhelming response for our recently launched product — Kia Sonet, the smart compact-SUV. Currently, our focus is on meeting the increasing demand for the Sonet followed by the Seltos and the Carnival. Our product strategy is based on what will be relevant to India in the coming years, and our focus is to thoroughly study and analyse the sentiments in the post-Covid-19 world to plan for the future. We are constantly evaluating market trends and demands, and will make a decision on our next launch based on the situation.

 

How has the Covid pandemic impacted Kia India’s plans?

We witnessed a strong first quarter in 2020, selling almost 40,000 vehicles. However, at the beginning of the second quarter, the coronavirus pandemic disrupted the whole economy. The auto industry, in particular, was one of the most affected sectors during the initial phase of the pandemic. However, with our timely assessment of the situation, we managed to stay strong during the pandemic by charting out the priorities. We did not deviate from our pre-planned activities like the launch of the Sonet but added a slew of initiatives in order to support our existing plans.

We introduced initiatives to support our partners and enhance safety for our customers during their purchase and service requirements. As a result of these efforts, Kia came out as the best and most supportive OEM brand in a study conducted by Indian dealers’ association FADA.

 

You seem to have been averaging 20,000- 23,000 vehicles per month now. What is the total volume you expect to close with this year?

We are expecting the sale of more than 1,40,000 units in 2020. We witnessed great consumer sentiment during the festive months of October and November and we clocked our highest ever monthly sales during both months. I can say we are well on our way to have achieved what we had set out for the year, and we should close it well.

 

You have capacity for 300,000 vehicles per annum. At the current pace, you will easily hit over 200,000-250,000 vehicle-mark in a single year and so with another launch, your capacity will be almost full. When are you likely to decide on capacity upgradation?

Our plant in Anantapur is currently running on two-shift operations. Our primary aim is to fully utilise the capacity of our existing plant in Anantapur by 2022, which has an installed capacity of 300,000 units per annum. As of now, it is too early to comment on further investment for capacity upgrade.

What is the level of localisation now? Where do you see this going up too?

India is a high-priority market for Kia globally, and as we say, we have been making in India for the world; our latest offer the Sonet is only manufactured in India. We have also partnered and helped set up the vendor park around our manufacturing plant to cut the logistics cost and time. All these efforts are in-line with our aim of achieving the highest level of localisation for our products, ensuring cost-effective services and spares.

What is the Kia market share now in India and what is the target?

Kia Motors India is now among the top 4 car manufacturers in the country with a market share of 6 per cent in 2020 overall, and 7.3 per cent in November 2020. In the last month, we registered sales figures of 21,022 units with the Sonet dominating the compact-SUV market with sales of 11,417 units. We also posted a robust y-o-y growth of 50 per cent for last month.

Our primary aim is to attain our full manufacturing capacity of 300,000 units at our state-of-the-art facility in Anantapur. We are extremely happy with our performance in the market and we hope to continue this momentum in the future.

The Kia network of dealership and service centres has been growing. What are plans on dealership expansion?

We have a wide-spread network of 265 touchpoints across 160 Indian cities. We are aiming to reach 300 touchpoints soon with a prime focus on cities beyond the metros like the northeast, the northern part of Telangana, Karnataka, and Western Rajasthan, etc, where we are not present yet. This expansion is majorly focused on Tier-IV and up-country cities/towns and this will help us further penetrate deeper into the Indian market.

Published on December 25, 2020

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