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Kia and Hyundai Challenging the might of Maruti Suzuki Arena+Nexa, in India?

As we all know, Kia and Hyundai are siblings of the same family. We do remember back in 1997 when Kia had filed for bankruptcy, it was Hyundai that had purchased a huge share of Kia and had got the company back afloat. To date, Hyundai Motor Company owns a part of Kia Motor Corporation and remains Kia’s largest stakeholder. In return, Kia Motors also has a share in different Hyundai Motor subsidiaries.


The difference between Kia and Hyundai is that both companies have their own brand philosophies to uniquely produce their vehicles. As you can see, they are related but not the same! As sister companies, both Hyundai and Kia work together, but under separate brand entities, to pull in impressive brand revenues that continue to grow every year.


In India, Hyundai of course was the first mover compared to Kia. However, Kia made up for a late entry with a stellar debut and consistent products which did well in the Indian market.


Maruti Suzuki on the other hand is an old horse of the Indian Industry. The regular channel of Sales was through the mother brand Maruti Suzuki, however, recently we have seen the launch of the Nexa Channel and the rebranding of the existing channel at Arena Channel. Together, their volumes are counted under the mother brand Maruti Suzuki.


A Look at Calendar Year YTD ( Jan to April ) of Last Year v/s This Year Volumes of Kia+Hyundai

  • Hyundai and Kia cumulatively had a volume of 1,47,989 LY and this Year they have got a cumulative volume of 27,6176 numbers.

  • They Have together struck a market share of 22.65% and continue to marginally grow their hold with 22.66% This year.

  • Together, they seem like the only OEM that has challenged the stronghold position of Maruti Suzuki India Limited.


A Look at Calendar Year YTD ( Jan to April ) of Last Year v/s This Year Volumes of Arena+Nexa of Maruti Suzuki India.

  • Maruti Suzuki has definitely gained in volume. This year their volume stands at 5,65,845 numbers.

  • However, Maruti Suzuki [ Arena+Nexa] together have a drop in market share, from a high of 53.53% they have together dropped to 46.42%.

  • Clearly, the water-tight grip of Maruti is loosening by the day.

VOLUME GAP BETWEEN KIA+HYUNDAI & ARENA+NEXA [ MARUTI ]

  • Last year, we had seen the gap between the two giants stood at 2,01,797 and This year it has increased by 87,872 to a volume gap of 28,9669

  • If one has to look at these volumes, then clearly Maruti has built the lead over Hyundai+Kia. The volume growth of Maruti is much higher than both Hyundai+Kia put together.

However, the story doesn't end here. The volume gap is one of the many parameters to judge the performance between the two giants.


Ratio Comparison

This is the most common parameter used to compare the relative performance over two different time periods.

Last year, Maruti Arena +Nexa were together were at 2.36 times the volume of Kia+Hyundai. However, This Year, Kia+Hyundai have got that ratio drastically down to 2.05

This means the ratio gap between the two has shrunk significantly. In other words, Hyudnai+Kia has started to show that together, they can play a stronger game of catchup with Maruti Arena+Nexa. Now, they have narrowed down the ratio to about double the volumes.


Growth

All OEM's look at growth as a parameter of performance. They use this to compare last year's performance against this year.

One can argue that bigger OEMs have a larger base and would be difficult to have an apple to apple comparison, however, the pandemic year had got all the OEM's to a more level playing field. All OEMs faced similar challenges, with regards to vendor management, market dynamics, customer preferences, etc.. The challenges were only relative to the size of the organization.

The growth of Hyundai+Kia together stood at a strong 86.62% as against Arena+nexa of 61.77%. Hyundai+Kia together seemed to have grown much more in terms of percentage compared to last year's volumes.


Time Period of Analysis: January to April This year v/s January to April Last Year.

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