While most of the auto industry has been lamenting declining sales, two new entrants to the market are raking in the cash. Kia and MG are the two brands that have started selling mid-size SUVs in the past few months, and already Kia now leads the segment with the Seltos.
The MG Hector had chalked up over 28,000 bookings within six weeks of it going on sale in July, while Kia Seltos that entered the market in August 2019 has over 60,000 bookings already. MG has been struggling to ramp up its production, leading to long waiting times for the Hector and even a temporary stop to bookings. Meanwhile, Kia has been selling nearly three times as many Seltos SUVs in just two months.
The thing is while others have lost some market share and seen sales slip, year-on-year sales for the segment have grown thanks to new entrants – Kia Seltos, Nissan Kicks, Tata Harrier and MG Hector – in the past year. While a total of 19,766 mid-size SUVs were sold in September 2018, this year saw 24,280 mid-size SUVs being sold. That’s an 18 percent growth over the previous year.
The SUVs that seem to be the most hit by the new entrants are, of course, former segment leader the Hyundai Creta, Mahindra XUV500 and the Tata Harrier as well. The Tata Harrier sold 2,075 SUVs in April 2019, which then dropped to just 740 units in July 2019 when the MG Hector was launched.
Hyundai, which sold 10,487 units of the Creta in April 2019, saw sales of its popular SUV drop to 6,001 units once the Kia Seltos was launched.
However, the company does have a facelifted Creta in the works, which will offer features similar to the Seltos. It is likely to be launched in a couple of months.
Clearly, this mid-size SUV segment isn’t hit by the overall auto-industry slowdown as it continues to grow. The thing is buyers have become far more value-conscious now. The Kia Seltos sets new benchmarks in the segment in terms of the features it has. And it offers good value for money.
Similarly, the MG Hector also managed to woo buyers with its “connected-car” features and the space it offers at an affordable price tag.
While some competitors such as the Mahindra Scorpio soldier on without taking too much of a hit, vehicles like the Tata Harrier and Mahindra XUV500 need to rethink their value propositions, while brands like the Jeep Compass and Renault Duster have even tougher decisions to make. Till then, Kia and MG will continue to rake in the cash.
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