Kia says industry slowdown temporary, to launch one new product every 6 months

Korean car giant Kia has no plans to step off the accelerator despite the current slowdown that has led to a sharp fall in automobile sales, forcing other manufacturers to cut production. The company launched the much awaited Seltos SUV on Thursday and will go ahead with its plan to launch one new product every six months.

"We are not like some other manufacturer, putting a stone in the water and experimenting to see how things go. We are very confident of the long-term prospects of the Indian market," said Manohar Bhat, head of sales and marketing at Kia Motors India.

The company has invested $1.1 billion in a plant at Anantpur, which has the annual capacity to manufacture three lakh units. He sees the current slowdown in demand as short-term bump, which will not affect long-term plans Kia has for India.

"We know the market, we have good products and good strategy. We have come in full scale and not holding back on our investment. We have a long-term plan for India and this temporary downturn doesn't affect our long-term thinking at all," Bhat said.

Kia launched the much-anticipated Seltos SUV in India at an introductory price of Rs 9.69 lakh ex-showroom. Prices go up to Rs 15.99 lakh for the top-end HTX plus and GTX plus models.

The Seltos line up will get premium features such as 8.0 inch heads-up-display, 10.25 inch HD touchscreen, a hi-tech sound mood lamp, a rear shade curtain, 360 degree surround view monitor, blind spot monitoring, connected air-purifier, proprietary UVO connect system for wireless communication with the car, an eight-speaker Bose sound system with sound mood lamp, six airbags and use of advanced high strength steel.

The Seltos SUV will go head to head with the likes of Creta, which is a product from Kia's sister company Hyundai, Tata Harrier, MG Hector and Mahindra's XUV.

Kia has already got more than 32,000 bookings for Seltos and deliveries will begin from Thursday.

The company has so far produced around 5,000 units and waiting periods will be around 45 days to two months. To meet the demand and ensure customers who have booked the SUV don't have to wait longer, the company will soon start production in second shift from one shift now, said Bhat. He added there were no plans to halt new bookings.

The automobile industry is expecting a big disruption with the new BS6 fuel emission norms coming into effect from April 2020. Most car makers will be launching BS6 compliant vehicles months ahead of the launch. The biggest concerns for auto makers is the lack of availability of BS6 fuel currently, particularly diesel. Some automakers have said filling BS4 diesel in a BS6 engine will have adverse impact, although there won't be any such issue with petrol engines.

Kia Seltos comes with BS6 engines on both petrol as well as diesel variants, and Bhat said Kia is not worried about the fuel issue.

"They (others) are not launching BS6 diesel because, I think, they don't have the technology or the capability of doing it. We have tested our BS6 car on BS4 in all corners of the country, more than a lakh kilometres has been run, on diesel also, on the current available BS4 fuel. There is absolutely no negative impact on the engine or its performance," said Bhat.

There is speculation in the market that the company will launch the Carnival MPV in India in 2020 to take on the Toyota Innova Crysta. Bhat is not disclosing Kia's product strategy just yet, but said the idea is to launch two new products next year.

"We are going to be launching one new vehicle every six months. The plan is very fixed," he said.

While Kia's manufacturing plant in India will mainly cater to the domestic demand, it may look at exporting products to neighbouring markets and even Africa and South America in the future.