New Delhi: Aiming to boost its share in India’s rapidly growing market for premium hatchbacks, Hyundai Motor Co. Ltd’s Indian subsidiary launched a cheaper version of its popular i20 hatchback, sharpening rivalry with market leader Maruti Suzuki India Ltd.

The Era, priced at Rs40,000 less than the present base version, will be available at an ex-showroom price of Rs4.51 lakh in New Delhi. The company also launched a variant known as Sportz. “Market prices are now increasingly driven by competition," said Kaushal Maroo, a research analyst at Religare Capital Markets Ltd. “In the next couple of years we’ll see more such instances of aggressive pricing." Price hikes this year have been muted as companies like Maruti haven’t been able to fully pass on increases in raw material costs to the consumer, Maroo noted.

The cheaper pricing will allow the i20 to compete better with Maruti Suzuki’s Swift and Volkswagen AG’s Polo hatchbacks.

New variant: File picture of the Hyundai i20. The new Era model is priced Rs40,000 less than the present base version. Ramesh Pathania/Mint

At present, the company manufactures the i20 for both the domestic and export markets in India. Local demand for the car has exceeded the company’s initial projections.

Hyundai’s facility at Irungattukkottai near Chennai produces 4,000 cars a month for the domestic market, against domestic demand that’s closer to 5,500 cars, according to the company. The car has a waiting list of about a month, Hyundai said.