Hyundai's zip drive hits bump

ARAI objects to firm's projection of Santro as a 5-seater car.

The battle for leadership in B-segment cars is heating up. A week after Hyundai Motor India launched a high-decibel campaign promoting Santro as a car that can legally seat five people, the Automotive Research Association of India (ARAI) has shot off a letter to the company seeking clarifications on the claim.

Hyundai India early last week started an advertisement campaign stating that its top-selling B-segment car, Santro, was a five-seater (as certified by the ARAI), while some of the leading B-segment models from competitors were only four-seaters.

Since ARAI certification has been cited in the advertisement, senior functionaries of the testing institute disclosed they had written to Hyundai seeking an explanation. Commenting on the development, ARAI Director Balraj Bhanot said the agency did not approve of such advertisement.

"We have written to the company (Hyundai Motor India) seeking clarification on this," he said, adding that any such advertisement must be more explicit and must clearly state which other models Hyundai was comparing its Santro with.

Hyundai executives, however, said they were yet to get any written communication from the ARAI regarding its advertisement campaign.

The moot issue, according to B V R Subbu, president, Hyundai Motor India is that consumers are not clearly informed about the seating capacity of cars as certified by ARAI. This, for example, could create problems if traffic regulators rise objection for carrying more than four people (including the driver) in a four-seater car.

"We do not plan to take this up with the transport authorities. Our effortis only to educate the buyers," Subbu told Business Standard.

While Hyundai 's advertisement does not name any of the competitor's models, the target of the campaign is obviously the popular models from the Maruti Udyog stables -- WagonR and Alto.

"This issue is not just about how many people Alto or WagonR can actually carry. The campaign puts pressure on buyers, due to issues related to traffic rules. This could even force consumers to strike out the Alto or the WagonR from their list," said an industry observer. When contacted Maruti officials refused to comment on this issue.

Sources also said that fact that sales of WagonR in February overtook that of Santro has put Hyundai on the defence, which in effect prompted this fresh campaign citing space differences in the models.

"Santro sales dropped in February due to a minor fire accident in our plant. We had to prioritise export sales over domestic sales. In March, we are confident that Santro sales will bounce back to over 10,000 units," Subbu said.