Chennai: Whenever Hyundai Motor India Ltd (HMIL) president A P Gandhi gets up from his chair, after a days long work, he is reminded of the future a future in which HMIL would play a crucial role in its Korean parent Hyundai Motor Companys global strategy. What reminds, prompts and drives Gandhi and his team towards that goal is a simple architects design of the futuristic plant layout.
Currently spread over 28 acres, HMILs $614-million Irungattukottai plant which has an annual capacity of 1.2 lakh cars and similar numbers of engine and transmission sets, and an aluminum foundry to stamp out cylinder heads is the $14-billion Hyundai auto groups largest facility outside Korea.
So where does HMIL, with unused 522 acres, fit in the Hyundai groups future plans? Gandhi has an answer. HMIL is going to be here for a long time to come, come whatever may. This plant will be the only production base for a particular type of car. The world car is now only on in a conceptual stage, and it would take some time to crystallise.
The world car project would evolve in the second phase of the project, for which more than US $400 million has been set about. HMIL had earlier announced that the first phase of the project would come to an end when it sells 1.2 lakh cars every year. We can attain this figure very soon, he says.
Fine, the world car will take some more time to roll out of the design boards, but HMIL is now on the mode of expanding its portfolio. The countrys second-largest carmaker recently came out with another Accent variant the sixth one, a 1.6-litre, 16-valve, double-overhead camshaft (DOHC) Accent Tornado for Rs 7.08 lakh ex-showroom, Chennai.
The new variant, with imported engine, costs Rs 63, 000 costlier than its predecessor. After the launch, HMIL hopes to sell around 20, 000 Accents this year and, well, they intend to maintain its leadership in the segment. And they are confident. The company wrested out the number one position from Ford India. Swan Kwon, the deputy-managing director of the company, says his firm has sold 12,822 Accents till date.
Says a Ford India dealer: This is just a temporary phase. Now, Ford India is driving its dealers hard with stiff targets to regain the lost spot. He is also buoyant about the imminent launch of Fords premium car, Mondeo, to be priced at the range of Rs14-16 lakh. But what really queers the pitch in the mid-segment is the launch of Palio, by Fiat, with an aggressive price-line.
Gandhi is not perturbed. We actually welcome competition. What Fiat did with Palio is nothing to talk home about; they are actually following our footprints whether in terms of pricing or promotion. If HMIL roped in cine star Shah Rukh Khan to promote its cars, Fiat could contract cricketer Sachin Tendulkar to push Palio into the market. Well, we wish all of them good luck. This is what Gandhi, the soft-spoken, has to say about the new kids on the block.
He also brushes aside the spare-parts price reduction strategy of some carmakers. This actually shows the level of profits they were enjoying earlier. Our pricing strategy has always been rational, and others are following suit.
In the same vein, he says that HMIL never got into price-cutting even with its vendors when the sourcing volumes once went up. The policy is to hold the price-line at constant levels sans passing on the inflation effect to the customers.
Reports are galore about an imminent launch from the Hyundai stable, but Gandhi emphatically says that that will not happen before 2003.
also see : Car wars