Cars

Hyundai has Decided to Discontinue The Santro

The Santro’s second outing fails to match the success of the original in terms of box office receipts.

Hyundai’s entry-level Santro hatchback has been phased out of production at its Tamil Nadu plant. The Santro was the first Korean car to be introduced to the Indian market, debuting in 1998. The first-generation model was sold until 2014, when Hyundai reintroduced the Santro as an Eon replacement four years later.

  • Hyundai Santro goes off-shelf for the second time
  • Around 1.5 lakh units of the Santro sold since 2018
  • FY2022 sales averaged at just around 2,000 units

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What Went Wrong with The Hyundai Santro?

In 2018, Hyundai reintroduced the Santro, starting at around Rs 3.9 lakh and rising to Rs 5.5 lakh for the top variant. The Santro debuted with new styling cues and a CNG engine option for its 1.1-litre petrol engine. The Hyundai Santro is positioned at the top of the budget segment, with features such as rear AC vents and a touchscreen. However, all variants of the car lacked a few basic features, such as intermittent windshield wipers.

The Santro’s entry-level model was overpriced for what it offered. At that price, it didn’t even come with a factory-installed air conditioner. Furthermore, the Santro’s higher variants were priced higher at launch than the now-discontinued Grand i10’s entry-level variants, which were more spacious and had a more powerful 1.2-litre engine.

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Hyundai considered repositioning the Santro’s lower variants in 2019 to compete with entry-level hatchback segment rivals such as the Alto and the 800cc Renault Kwid. However, the introduction of the more stringent BS6 standards resulted in higher input costs, which led to even higher retail prices.

The Santro’s sales peaked at first, but since then, they’ve been on the decline, and customer interest in Hyundai’s entry-level model has dwindled. One of the reasons for the Santro’s demise could be the shifting consumer trend toward SUVs or SUV-like high-riding vehicles. Maruti Suzuki anticipated this trend and replaced the slow-selling Alto K10 with the S-Presso, a high-riding hatchback with SUV-like styling cues. In FY2022, the S-Presso sold around 67,000 units, or about 5,500 units per month on average. Meanwhile, Santro’s monthly sales in FY2022 averaged around 2,000 units.

Furthermore, the government’s recent order mandating the installation of six airbags could be another nail in the Santro’s coffin, as Hyundai will have to re-engineer the car to meet the requirements, and the additional costs would simply not justify the car’s positioning. Furthermore, with the impending BS6.2 emission standards, upgrading the 1.1-litre engine, which is only available on the Santro, will be uneconomical.

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What’s Next for Hyundai’s Entry-Level Vehicle in India?

Due to the discontinuation of the Santro, the Grand i10 Nios will serve as Hyundai’s entry-level model in India for the time being. The hatchback is priced from Rs 5.39 lakh onwards (ex-showroom). There are rumors that Hyundai will introduce a micro-SUV under the Venue (which is also due for a facelift soon), which could be the future Santro of SUVs due to its high riding character.

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