Hyundai’s exports to Europe hit by downturn

HYDERABAD: Hyundai Motor India Ltd., (HMIL), on Friday, said its exports were hit due to the recent economic crisis in Europe. As a result, the company, said it will witness a marginal decline in exports during the current financial year and has accordingly de-risked its geographic presence to markets other than Europe.

Currently, over 6,50,000 units are produced from its two manufacturing plants in Chennai. Of this, about 48 per cent are exported, while the remaining 52 per cent are marketed within India. "The domestic market will continue to increase to about 57 per cent of the total production. The decline in exports is primarily due to the economic turmoil in Europe. We are trying to cover up our losses from Europe by exporting products to other geographies such as South America and South Africa," said Arvind Saxena, Senior Vice President,  Marketing & Sales, HMIL.

According to Saxena, HMIL has cut down 25 per cent of its exports to Europe following the economic crisis. Saxena, was here to launch the new Verna Transform, which is expected to register about 25-30 per cent growth in sales. He added that the present production capacity  will be sufficient for the next couple of years.  

Commenting on the Indian automobile sector, which posted growth of about 28-29 per cent for the first five months of 2010, Saxena said it will register double digit growth throughout the year at about 15-16 per cent.

Despite rising input costs, the company, which releases three new models every year, ruled out increase in prices in the near future.

Giving details about HMIL's R&D division in Hyderabad, Saxena said, it does data analysis, component development and localisation of components besides design and product development of several future products. Currently, it employs over 400 engineers and is likely to expand on a time-and-need basis.

Meanwhile, to cash in on the small-car segment, HMIL said, it is working  on a model that is priced below Santro. "We have definite plans to introduce a small car and the project is on course," said Saxena, without divulgnig details about size and pricing.  HMIL's dealer network will be increased from the current 290 to 320 by end of 2010.