Utility vehicles ride on overseas high

Shipments jump 173% in two years; however passenger car exports decline 3% between FY14 and FY16

The popularity of Indian utility vehicles (UVs) is not limited to the domestic market. These vehicles are finding more and more takers abroad, too. Exports of passenger cars have declined for consecutive years, with a total drop of three per cent between FY14 and FY16. Shipments of UVs, however, saw a sustained increase and jumped 173 per cent between these two years.

India exports one-fifth of the 3.4-million passenger vehicles (cars, UVs and vans) it manufactures in a year. Utility vehicles formed a mere seven per cent of passenger vehicle exports in FY14. It rose to 12.4 per cent in the following year and is now a significant 18 per cent of total exports. From a mere 43,433 units in FY14, India exported 118,721 units of utility vehicles in FY16. In the same period, the share of UVs in the domestic market has remained stable at 21 per cent.

Export in this segment is dominated by Ford and Hyundai. Interestingly, 70 per cent of the UV export is done by Ford alone for EcoSport, whose exports surged 51 per cent last year to 83,325 units. For Ford, the fourth largest exporter, EcoSport brings 75 per cent of export volumes. Manufactured in Ford’s Chennai plant, EcoSport is shipped to various markets  in Europe, Africa and Asia-Pacific.

Hyundai, the biggest exporter of passenger vehicles from India, shipped 19,000 units of Creta, the UV it launched in July 2015. The South Korean car maker had not exported any UV in the previous year.

“Hyundai's increasing export of Creta showcases the global trend of rising customer preference for compact SUVs as a disruptive product over MPVs (multi-purpose vehicles) and mid-sized sedans. These are being sought due to their ability to meet the rising aspirations and needs of customers in urban and rural markets who seek bold, powerful engines, comfort and low cost of ownership,” said Rakesh Srivastava, senior vice-president (sales and marketing), at Hyundai.

Maruti Suzuki exported around 8,400 UVs, mostly Ertiga. Its UV export volumes, however, dipped from 10,500 in FY15. M&M, the largest UV player in the country, shipped 5,600 units last year, , showing a marginal increase over FY15.