Plans for new Hyundai compact car to slot in between i10 and i20 speed up

The sub-4 metre compact car segment is suddenly hotting up. A while ago, there was news of Hyundai planning a compact sedan on the i10 platform, and now a new report suggests that a compact car, probably a hatchback, is already being tested in South Korea.

The Economic Times reports that Hyundai is working on a new compact car to slot in between the i10 and the i20. The report also says the car will be powered by a 1.1 litre diesel engine (an engine that is speculated will also power the Hyundai i10 diesel) and a 1.2 litre petrol engine (which would probably be the same petrol engine that powers the current i20 and i10). The car is apparently codenamed BA, and will be ready by the festive season of 2013 – so expect a launch by October-November this year. It seems Hyundai wants to hit 1.5 lakh units annual sales with this new car. Also read: Upcoming small diesel cars to launch in 2013

This will be Hyundai’s fifth small car in the Indian market after the Eon, Santro, i10 and i20. It already sells four sedans as well – the Accent, Verna, Elantra and Sonata, as well as the Santa Fe SUV. It is planning on bringing in an MPV based on the Hexaspace concept it showcased at last year’s auto show. Also read: Upcoming cars from Hyundai

Is there space for a compact car?

The report does not say if this car will be a compact sedan (a notchback) or a hatchback, but given the interest and demand for seemingly three box cars (sedans) in India, and the attraction of low-excise duties for cars under 4-metres in length, Hyundai could probably be looking at either option. Earlier reports from Turkey suggested that Hyundai is planning to build a compact sedan on the i10 platform, and this seems like a good fit for India.

However, one big challenge for Hyundai would be in price-positioning such a compact car. The Hyundai i10 is priced between Rs. 3.7 lakh to Rs. 6.15 lakh (only petrol variants available as of now). The Hyundai i20 is priced between Rs. 4.75 lakh and Rs. 7.78 lakh (in 12 variants, five diesel and seven petrol). The i10 and i20 classify as small cars, conforming to the sub-4 metre rule and with 1.2 litre petrol or 1.5 litre diesel engines.

The new compact car, too, should fall within these specifications if it has to be priced attractively. The problem is – if it’s cheaper than the i20, it would probably kill sales of the i20, which is quite a popular premium hatch at the moment. If it’s priced too close to the i10 – with overlapping prices – which is bound to happen, it may take away sales from the current i10.

Some degree of cannibalization is bound to happen, but what Hyundai will be looking at is to take away some share of the pie from Maruti’s Dzire, Swift and Ritz. If this new car codenamed BA can do that, it will be a winner for Hyundai. Also read: Hyundai to build compact sedan on i10 platform

Source: The Economic Times