Q: How is Hyundai looking at rural sales?
Srivastava: Yes, we have been focussed on rural sales. Last year, we had 270 rural sales outlets and this year we are targeting about 300. Last year, our rural sales were around 18.6 percent of the total. We believe this is the way forward largely because we have the products; also it is the range which that customer likes to enjoy as the cost of ownership is very low. If we take year on year, our rural sales have grown from 15.9 to 18.6 percent. But, more importantly, they have actually grown when the market has shrunk 7 percent. So if the market had grown, the number would have been much higher.
Q: How have you gone about cracking the rural sales market?
Srivastava: For us, it has been good. We needed to make interventions in terms of channel expansions where we have a concept called rural sales outlets—it is a 1,000 sq feet display area, in which one or two models can be displayed and it also caters to the service requirements. Every facility has service capability with one or two bays. For this, we have also picked up Hyundai champions. These are prominent people in villages who are influencers; we take them on board, train them and they are attached to our channel partners. They source inquiries for us and also act as statistics providers.
Q: You have added new models to your portfolio. Is there going to be any capacity constraint?
Srivastava: Last year, we did 6,33,000 units, out of which 3,80,000 were sold in the domestic market. We had a 99 percent capacity utilisation. Our MD, who is a production expert, has again recalibrated the entire manufacturing process and from the same plant, we will be able to take out almost 40,000 more units.
Q: Do you believe you have been slightly late into the compact sub-4 meter space?
Srivastava: We are a company, which makes a very strong statement in whichever segment we enter into. We have been consolidating our presence first in the compact segment, where we have a 27 percent market share. In sedans, we have a 40 percent stake in high-end sedans with the Verna. Yes, it was but natural for Hyundai to come into compact and we have made the decision to come.
Q: Does 2014 look like a tough year?
Srivastava: Last year was very tough. It was a year when the automobile industry actually degrew on a calendar year basis, for the first time in 15 years. For Hyundai, it was very rewarding as with 99 percent capacity utilisation, we met our business targets. Last year, we also posted our highest market share since inception in India [20.7 percent].