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What Will Kia's Entry Into the Indian Market Mean for Leaders Like Maruti Suzuki?

Kia Quoris K900. (Photo: Facebook/<a href="https://www.facebook.com/Kiamotorsworldwide/" target="_blank">Kia Motors Worldwide</a>)

Kia Quoris K900. (Photo: Facebook/Kia Motors Worldwide)

Kia Motors is expected to enter India soon and being Hyundai's cousin, it might make a grand entry.

Based on recent reports that state that Kia Motors will be picking a site to for its first manufacturing plant in India we are very well on the verge of seeing another major auto manufacturer step into one of the biggest auto markets in the world. Usually, that will not be a concern for a company like Maruti Suzuki which holds the majority share in the number of cars sold annually in India, but given that Kia will have access to Hyundai's reach and facilities in the country, Kia might just climb up in the number sales way faster than expected.

Hyundai started India production nearly two decades ago and has two factories in India that make cars for the domestic market and for export to Europe and elsewhere.

The firm trails only Maruti Suzuki India Ltd in sales in India and has an extensive service and dealer network that gives it an advantage over global rivals that have struggled to build market share including General Motors, Toyota Motor Corp and Volkswagen.

Kia's South Korea factories accounted for 57 percent of its sales last year. It also has plants in China, the United States and Slovakia, and its first Mexico factory began production earlier this year.

Hyundai shares parts and vehicle underpinnings with Kia, which Hyundai bought at the height of the Asian financial crisis in 1998.

So what Kia really needs to do is establish a separate identity for itself. Hyundai and Kia both have most of their products which target the small car segment, and that is where auto manufacturers gain the most in terms of presence and identity in the Indian market. Renault, for example, had the tides turn to its favour after the launch of Kwid and Datsun, Renault's cousin is hoping to repeat the same story with the Redi-Go.

If Kia is able to do something different in the Indian market, and works hand in hand with Hyundai, then it might just be one of the biggest entries into the Indian market by an auto manufacturer in years.

(With inputs from Reuters)

first published:July 22, 2016, 16:06 IST