Hyundai is expected to launch its 2,000cc Elantra car later this month, which might be the priciest sedan to be assembled in Pakistan. An expert believes that it would be priced above Honda Civic Turbo, which is currently the costliest sedan car assembled in the country.
Hyundai has already been assembling the H100-Porter pick-up truck and SUV Tucson. H100-Porter was previously known as Shehzore. The company sells the imported Grand Starex, Ioniq Hybrid and the seven-seater Santa FE vehicles too.
“I think if Hyundai launches Elantra’s 2,000cc variant then it will cost more than Toyota Corolla Grande and Honda Civic, making it the priciest car,” said Usman Ansari, an auto sector expert who runs blogging website carspiritpk.com.
A source privy to the matter told SAMAA Money that Hyundai would initially launch the 2,000cc variant of Elantra, without sharing the company’s future plans.
Ansari said Hyundai was positioning itself in Pakistan as a premium brand by pricing its car slightly above the category’s expected competitor.
“We have seen it when it launched Tucson (crossover SUV) and priced it above Kia’s Sportage,” he said. “So, I think they may do something similar with Elantra too.”
Ansari was critical of Hyundai’s strategy as worldwide Elantra is taken at most similar to Corolla and Civic. Top Civic variant is priced at Rs4.7 million, while Corolla’s top variant Altis Grande is priced at Rs4 million. Ansari thinks the company may price Elantra above Rs4.7 million to attract the elite class.
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The company was bringing a model that was launched in the world in 2014 with some facelift changes.
“Hyundai International has launched Elantra’s new model in its premium markets like the US, Europe and Australia this year,” Ansari said. “But in Pakistan, the company is launching the previous model that Hyundai International has been gradually phasing out.”
CKDs (completely knocked down units or car components) become less costly of a car’s previous model when the new model starts emerging across the world, he explained.
Ahmed Lakhani, a senior research analyst with JS Global, said that Pakistan is a third world country and launching newest and subsequently pricier models doesn’t make a viable business case for carmakers.
“I think if Hyundai launches newest model of Elantra then it may enter into the market of crossover SUVs on the basis of price, which may make it unattractive for buyers,” Lakhani said.
Hyundai Nishat Motor is a joint venture of Nishat Group, Sojitz Corporation (Japan) and Millat Tractors Ltd. The company has an annual capacity of 15,000 vehicles, which it may increase if the demand goes up. It has 14 dealers across the country so far, with six more in the pipeline.
The joint venture was established under the greenfield status with its car assembling plant in Faisalabad. Hyundai is one of the car companies that came to Pakistan after the government announced the Auto Development Policy 2016-21.
The policy will end in June 2021. New entrants in the Pakistani auto market have been trying to launch the maximum number of models before the deadline expires.
Under this policy, the companies launching new cars during this period will get tax incentives for five years. The policy aims to boost the auto industry and encourage competition in the country.
Besides Hyundai, Kia, MG Motors and Changan are also launching new cars before June 2021.
Hyundai faced criticism for increasing the price of its Tucson SUV from Rs5.4 million to Rs5.6 million just a day after its launch in August. A company official said they received more orders than the number of vehicles available on an introductory price within a couple of hours.
“The company was not expecting such a high demand in the midst of the pandemic when it launched the Tucson,” the official said.
Tucson’s main competitor is Kia Sportage. Interestingly, Hyundai is the parent company of Kia. Both are South Korean companies. The two companies’ international volumes are reported combined, which makes them enter the list of top ten car manufacturers.
Experts believe that both the companies will bring competition to Pakistan’s auto industry which has been dominated by the Japanese automakers.
“The appetite for good features in cars has changed after the introduction of imported used cars,” said Shakaib Khan, who runs the SK Motors Syndicate. “All the upcoming cars such as Elantra will compete on features which were previously missing in cars assembled in Pakistan.”
Shakaib said that cars such as Elantra, which is a popular brand worldwide, will give tough competition to Toyota Corolla and Honda Civic.
Hyundai is also expected to launch another sedan, Sonata, in the CBU (imported completely built units) form. It will fall in the category of Honda Accord and Toyota Camry, which also make it to the Pakistan market in CBU form.
Khan said Sonata will compete with high-end sedans.