Young buyers, big wheels: Hyundai's Virat Khullar on the SUV surge

For Hyundai, its road to growth in India comes with a twist. Its customers are “getting a year younger every year for the past four years” while the demand for sport utility vehicles (SUVs) is on an upward drive.

Ironic? Perhaps it's expected that older customers can afford the larger cars. However, the carmaker’s group head of marketing, Virat Khullar, insists it’s actually a sign of India’s progress. “We are getting younger people to buy our cars with a higher monthly household income.”

He shared this insight with afaqs! on the day Hyundai dropped the first song from season three of Hyundai Spotlight, its IP for up-and-coming musicians to jam with the pros. 

“The customer is flipping screens from television to mobiles, and the formats are also changing. For a marketer, we should use all tools possible which make the thumb stop.”

Virat Khullar, Hyundai India

“Almost 60% of our portfolio currently are SUVs, and we see that not ebbing any time soon,” he reveals. Turns out, this love for the mechanical giants in the passenger vehicle segment has been building for some time. 

As per Business Standard, SUVs accounted for 50.4% of total passenger vehicle sales in FY24, up from 43% in FY23 and 40.1% in FY22. This share is projected to reach around 54-55% by the end of FY25.

At the same time, hatchbacks and sedans are seeing their fortunes reverse. The Economic Times reports that the share of hatchbacks has slipped to 30% in H1 FY24 from 35.1% in the same period last fiscal. Also, the share of sedans, too, declined to 9.3% in the fiscal first half from 10.3% in H1 FY23.

Why are people so enamoured with SUVs? Is it an ego massage or a steely insurance against road rage? It’s both and some more. Khullar says an SUV is a symbol of status and of progress in one’s life. “A large car obviously stands for comfort and long travels,” he adds. 

But beyond status and comfort, there’s another reason SUVs are winning hearts — safety. Khullar says all Hyundai cars, not just SUVs, have six airbags as a standard feature. More than seven cars come fitted with Advanced Driver-Assistance Systems (ADAS), and—pay attention here—“SUVs are now starting at lower price points.”

This could explain how young customers, who may not enjoy the same purchasing power as the 40-plus crowds, buy these road hoggers. He says the Hyundai Exter now starts at an entry price point (Rs 6.20 lakh in Mumbai), and the Hyundai Tucson and the Ioniq 5 go up to almost Rs 50 lakh. 

“They straddle across price points. They straddle across body types. And yes, today more than 60% of the sales are coming through SUVs.” 

Hyundai India does not focus only on the Indian Premier League (IPL) or Diwali—India’s two biggest seasons for advertising—to reach its SUV-loving-yet-so-young customer base.

Khullar ensures Hyundai is present in the mind of an in-market customer (actively considering a car buy) and an out-market customer (a potential customer in the future). 

“We continuously track metrics on cost per reach, cost per view, and also the bottom funnel—‘Where am I getting my cost per retail?’”

Is a big celebrity the answer to reaching both customers? Not really. “The customer is flipping screens from television to mobiles, and the formats are also changing. For a marketer, we should use all tools possible which make the thumb stop,” he answers. 

By the way, Shah Rukh Khan has been the brand ambassador for Hyundai in India since 1998. “Be it a celebrity, a CGI video, or a penny drop moment through a song, we should use all ways to ensure memorability built around our brand.”