Kia India is open to introducing CNG and hybrid models, as the management confirmed during the Sonet launch in New Delhi.
Earlier during the updated Seltos unveiling in July this year, the company had stated that hybrids “are for those who don’t have clear EV plans”. As Kia India explained that its EV plans will take off from 2025 and introducing hybrid powertrains does not make sense.
While addressing a question on the introduction of hybrids and CNG models, MyungSik Sohn, Chief Sales Officer, Kia India, stated that the company is looking for the possibility of introducing the hybrid and CNG models in India, but this would depend on the customer's demand and also on the regulations in India.
As per Kia India’s research, hybrid penetration in the mass market segment stands at 2.5% at present. This makes the Indian market less attractive for the carmaker to invest in hybrid technology for the market.
Sohn stated that while the company has all the technologies available in the Koran R&D centre, a change in emission norms in India would allow hybrids and CNG models to grow. And this is the time when the Korean carmaker will introduce its hybrid and CNG models.
On Track With EVs
While the company is still assessing the situation for hybrids and CNG models, it is sure about the uptake of EVs in India. Interestingly, the company’s EV journey in India started with the launch of the EV6 in May 2022. In the first year, Kia India enjoyed a whopping market share of 37% in the INR 50 lakh plus EV category.
However, with the increase in competition, Kia India’s market share in the category has shrunk down to 20% currently, confirmed Hardeep Singh Brar, Vice President & Head – Sales & Marketing, Kia India. To gain further momentum in the segment, Kia India plans to bring in Kia’s flagship EV, the EV9, in 2024.
However, Kia's real growth in the EV space will happen with its mass-market EV, which is slated to enter the market in 2025. With this, the company targets 10% market share in the EV category by 2026.
Stating that the e-RV will more or less be in the Sonet category, Sohn hinted that the product might go up against the likes of the Tata Nexon EV. However, Brar added that the company has yet to decide where to position the EV.
He continued that the company is on track with the timelines for the product and is currently looking at ways to manufacture the batteries locally. Interestingly, the global team of Kia, along with Kia’s Indian team, are working together on the product, where the Indian team is largely focusing on the design aspect. Brar further hinted that the company also collaborates with its sister brand (Hyundai) on the project.
Strong Demand For Diesel Models
While the company focuses on sustainable and alternate fuel options, it is also witnessing a strong demand for diesel.
In fact, with the current lineup, Kia India is witnessing 35% of sales coming from diesel models. Brar stated that diesel also helps the company in CAFE norms, as it gives additional points. In CAFE norms, diesel is not seen as negative; rather, it is seen as positive, he added.
With this, the company is banking on diesel models and has reintroduced the manual transmission option for Sonet diesel variants.
Expectations With New Products
With the new Sonet, Kia India has now updated two of its most popular models, with the other being the Seltos, which was updated in July this year. Brar stated that with these updated and existing models, Kia India is looking to close the financial year with domestic sales of 2.55 lakh units, with a growth rate of 10% YoY.
This would include 80,000 units of the Sonet, which in FY23 saw domestic sales of 86,000 units with a market share of 13%. However the ultimate aim is to retail around one lakh units of the Sonet in the next financial year, Brar confirmed.
He added that while in the current financial year, the company will witness 73% of its sales coming from the SUV range, with two new updated models in FY24, it aims to close FY25 with 80% of its sales coming from SUVs.
The growth in sales will also be accompanied by the increase in the sales network, which the company plans to reach the 400 mark by the end of FY24. Another advantage for the company is the easing of the chip crisis, which has helped it increase production and reduce the average waiting period from six months to two months now.
While the company is utilising its 100% production capacity, the plan now is to optimise the assembly lines to increase the capacity to four lakh units annually by 2025 before expanding the capacity, Sohn confirmed.
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