Nice Problem For Hyundai: More Buyers Than Cars

Well, it seems that the wrecked US-Korean trade pact only affects U.S. food exports to Korea. It most certainly does not seem to have any influence on Hyundai. Hyundai expects to set a company record for annual U.S. sales next week already, and to sell even more in 2011.

With a fresh lineup of cars, including the successful Sonata sedan, Hyundai expects to pierce the 500,000 unit mark by mid-December and thinks it will end 2010 with a 4.8 percent share of the U.S. market.

As for the U.S. market as a whole, Hyundai U.S. chief John Krafcik is more sanguine. He hopes it will rise from about 11.3 million this year to 12.3 million vehicles in 2011. That’s about 8.8 percent, and Krafcik think the growth will almost purely come from sales to retail customers, reports Reuters.

“As we look at how heavy the industry went to the fleet market to keep sales up this year, it is pretty amazing. We are not going to have that next year,” Krafcik said.

To get to a million more in 2011, retail sales would have to rise by about 10 percent, and Krafcik thinks it’s a tall order, with retail sales closely tied to housing starts and home equity, and with uncertainty amid high unemployment. “That is asking a lot,” Krafcik said.

Krafcik isn’t looking at increasing his market share a whole lot more in 2011. He doesn’t have enough cars to sell. Hyundai has been hitting maximum production capacity in the United States, with sales up 21 percent through the first 10 months of 2010, and will have similar limits next year, Krafcik said. Hyundai increased capacity in the U.S. by about 100,000 units this year. 400,000 of the 500,000 cars are made in the U.S.

Krafcik could use a few more plants: “I think it is fair to say we will probably be production constrained next year as well.”