Hyundai and Chevrolet to discontinue Santro Xing and Chevrolet Spark hatchbacks in India?

Even as the entry-level budget hatchback segment is witnessing a flurry of action in India, old hands such as the Hyundai Santro Xing and the Chevrolet Spark may be considering calling time on their Indian careers. The Hyundai Santro Xing being discontinued is a rumour that has been surfacing every now and then, only to have the South Korean automaker denying this development. Rumours of the Santro Xing hatchback being phased out of the Indian car market arrived on the back of the Eon’s launch in October 2011.

Three years hence, the Santro Xing has managed to not just remain in the car marker but maintain steady sales of about 3,000 monthly units. The tall-boy hatchback’s practicality, spaciousness, reliability and decent pep are major selling points. The faithful continue to patronize one of Hyundai’s best selling hatcbacks in India, the car that made the South Korean automaker a household name here. The latest indication of the Santro Xing being discontinued goes one step ahead, by suggesting that November 2014 will be the last month of production for the hatchback at Hyundai’s Sriperumbudur factory.

The Santro Xing being pulled out of the market could have multiple reasons.

  1. Hyundai will want to shift focus on to the Eon budget hatchback, which is now available with 800cc and 1 liter engines. The Santro Xing’s extra pep by means of its 1.1 liter-4 cylinder engine is no longer a differentiating factor.
  2. Hyundai India is planning new products for the Indian car market, with the iX25 arriving next year and the compact MPV arriving a year later. Production capacity constraints (yearly capacity stands at 680,000 cars) at the Sriperumbudur factory are staring the automaker in the face. While going slow on European exports will liberate some capacity, pulling the plug on the Santro will give Hyundai’s product planners more leeway for innovative ideas.

Coming to the other major, rumoured phase out, the Chevrolet Spark hatchback is also said to be nearing its end in India. Production of the Spark could grind to standstill in December 2014. A replacement to the Daewoo Matiz, the Chevrolet Spark hatchback started off strongly in India. However, the advent of newer competition dealt debilitating blows to the car, which simply could not stay relevant enough for the Indian budget hatchback buyer. The car is now a pale shadow of itself at the hustings, with monthly average sales of under 200 units.

If the Chevrolet Spark goes out of production, General Motors India will be left with no entry-level budget car, and this in a market where 1 out of 3 new cars sold is an entry-level model. General Motors’ strategy for India seems bemusing in the least, what with the American automaker struggling at the hustings, and with no new volumes spinner in sight for the next 2-3 years. General Motors has been operating in India for nearly two decades and has a paltry 2 % market share to show for.

Via TheEconomicTimes