Kia, the Korean subsidiary of Hyundai Motors is planning to make an entry into the Indian automotive market as a mass market small car maker. We know, in India, the small car segment has been Maruti Suzuki's domain for over a decade with its best-selling product on slot like Alto. And this segment plays major role in the total sales of Maruti Suzuki.
But, this move will be challenging for Maruti Suzuki with Renault Kwid launch couple of months back, made its mark in the segment. This small car as hit over 1 lakh booking at the start of Februray. While Tata Motors is also all set to launch the Zica hatchback, Datsun is working on the RediGo hatchback and Renault has already unveiled the Kwid 1.0-litre engine and AMT engine at the Delhi Auto Expo that are due for launch this year. The new entrants will surely heat up the small car segment.
Currently, Hyundai Motors owns more than 17% market share in the country and is very to eager to increase to 20% by 2020. The brand is currently in a discussion with with many state government to negotiate for the set up of a new manufacturing facility in India. Though, it is expected that the company will mostly like to set up its facility in Tada, Andhra Pradesh, which is in close proximity to its parent company Hyundai Motor India's facility at Sriperumbudur in Tamil Nadu.
As speculated, Kia will invest over $500 million to set up its facility which will have a production capacity of around 3 lakh units a year. The brand has many entry level products like the Picanto and are working over the nex-gen Kia Rio, a new hatchback and a sedan.