Hyundai to tap capital market once profits start flowing in
Rupali Mukherjee & Murali Gopalan
NEW DELHI, January 13: Mong-Gyu Chung was here on Monday to witness the launch of the Santro. The 36-year-old chairman of Hyundai Motor Company is upbeat on India and believes that consumers here know what they want. Santro will fulfill a long-term need, says Chung, in a free-wheeling interview to The Financial Express.On the prospects of the Santro. The Indian consumer is not exposed to various models. He really does not have too much of a choice while buying a car. Santro will be the alternative to Maruti and we are confident that it will do well here. It will have a major plus in two departments - safety and space. One would not feel vulnerable in this car which has been tested extensively. How can price be more important than your life? Our localisation programme is also at a much more advanced stage than potential competitors. These are the Santro's strong points and, helped by innovative marketing, will do well. The car will be an alternative to Maruti. On the obstacles in the
Indian car market. On the contrary, India is an extremely attractive destination and we are happy that we set up our second biggest plant here. The state government has been very cooperative and work has continued unhindered at the factory. This aside, Tamil Nadu has a strong base for ancillary suppliers and this has been a factor in our favour. The Indian economy is also far more liberalised than China. On Hyundai's projections of the Indian car market. By the turn of the century, we expect production of cars in India to be around 7,50,000 of which a large portion will be for the small segment. Hence, we will need to focus our attention on this range and the Santro will fulfil that need. On the other car models to hit the Indian market. After Santro, we will introduce the successor to the Accent which will make its entry towards the end of next year. This car will be introduced in India and Korea simultaneously. We will expand our range here, once we have sufficient volumes for the
Santro. On Hyundai's plans to offload a part of its stake to the Indian public. Hyundai Motor India will definitely make a public issue sometime in the future. We want to be a part of the business in India. At present, the company has already made a private placement for 14 per cent of its equity with select foreign institutional investors. As we start making profits, we will consider a public offer. Nothing, however, has been decided on its size or the timing of the issue. On the impact of the Korean crisis in India. There has been no impact here. But back home in Korea, the first impact has been seen in small car sales. In a matter of three months, sales of the Atos have increased dramatically because it is the more economical car for the consumer. Hyundai has weathered the storm better than most other Korean companies because of the diversity of our business operations right from cars and ship-building to semiconductors. As regards the Indian operations there will be no drastic price
changes as the imports are basically from countries other than Korea.
Copyright © 1998 Indian Express Newspapers (Bombay) Ltd.
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