By on January 2, 2014

kia-k900-la-auto-show-14

2014 may only be a day old, but it’s already shaping up to be a rough year for Hyundai and Kia as they prepare to increase global sales by just 4 percent this year, the lowest and bleakest forecast for the Korean duo since 2003.

Though the foreseen growth will be fueled by revamped models and increased production in China, and is in line with overall projected global sales in 2014, a stronger won and weaker yen — the latter brought about by Japan’s desire to support its export industry and to find a way out of the 20-year trek through the economic wilderness — have eroded the price advantage Hyundai and Kia held over their Japanese competitors.

While the duo experienced market growth in Brazil and China last year, they lost market share in both their home market and in the United States, the former through a free trade pact between the European Union and South Korea. Sales in 2013 totaled 7.56 million units worldwide, with a total projection of 7.86 million going forward in 2014.

Shares of the parent automaker haven’t fared well in the outgoing year, advancing only 8 percent against GM’s 41 percent and Toyota’s 60 percent surges on the trading floor.

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53 Comments on “Hyundai, Kia See Weakest Annual Sales Growth in a Decade...”


  • avatar
    Stu L Tissimus

    Think there’s any connection to the ouster of Krafcik, or just a poorly timed coincidence?

  • avatar
    SCE to AUX

    5-year changes in stock price:

    HYMTF: 734%
    GM: 18%
    TM: 81%

    I’d say Hyundai is merely catching its breath.

  • avatar
    Buckshot

    Maybe the crap that they´re selling has caught up with sales. Great when new but a couple of years later you wish that you bought japanese.

    • 0 avatar
      SCE to AUX

      Which explains why Hyundai/Kia has one of the highest repeat customer percentages in the industry.

      • 0 avatar
        NormSV650

        Those positive refferelals haven’t seen their out of the 10 year warranty.

      • 0 avatar
        Buckshot

        I don´t know about your country but here the warranty is completely useless.
        There are more (loop)holes than swiss cheese.

        • 0 avatar
          SC5door

          So what’s the loop holes then?

          Or is it that people believe they are covered “bumper to bumper” for 10/100,000?

          • 0 avatar
            Buckshot

            Many parts are considered “wear parts”.
            If the brake discs needs replacement they are not covered, even if they are just 1 yo.
            If the rear brake light was broken, you probably had backed into something.
            The interior light broke down. No new light just some glue that hold for a couple of months. Then the warranty was finished.
            The warranty was 3 years. After 3 years and 2 months the ac broke down. Then i sold the pos.

    • 0 avatar
      Upthewazzu

      Pretty much agree with this. As the owner of a ’10 Santa Fe, we’ve had FIFTEEN warranty repairs in 3.5 years. Unreal.

      • 0 avatar
        EdSTS2000

        FIFTEEN warranty repairs? How many of those were major (major meaning issues that would render the vehicle undrivable, or no AC in summer) issues? My 2010 Santa Fe (SE, FWD V6) has been fairly trouble free in 3.5 years and 51000 miles. 1 major issue (failing inner tie rod @ 42K miles) and 2 minor issues (interior trim piece and passenger door lock). All fixed under warranty and only the tie rod required an unscheduled dealer visit.

    • 0 avatar
      ajla

      I don’t know, anecdotal though it may be, the three people I know that bought new Kia/Hyundai vehicles (04 Spectra, 05 Sportage, 03 Elantra) all still have them on the road. I personally wouldn’t be afraid of them.

      I can’t speak at all for the newer stuff though.

    • 0 avatar
      E39luv

      We sold our ’01 Santa Fe with 120k, and I received an email from the next owner telling me he successfully finished a cross country move in said Santa Fe, turning 180k miles in the process. We had no crazy repair bills during our ownership, and he said he’s done nothing but brakes, tires, and oil. I’m not a fanboi, but my experience was good.

    • 0 avatar
      Ion

      We had a 01 sephia that was complete rubbish. As a result no one in my family will go near a Hyundai/KIA product again. It’s funny because the people that tell me that was over 10 years ago are the same people who’ll chastise me because their relative had a garbage Tempo in the 80′s.

    • 0 avatar
      sideshowtom98

      Would you prefer Toyota, which has been #1 in recalls for 4 of the past 5 years, worldwide?

    • 0 avatar
      don1967

      Sorry abour your interior light, Buckshot, but you’re off-base and off-topic.

      There are likely two forces at play here: Model cycles (not many new launches planned in 2014) and simple math. Now that the company has grown from fringe player into mainstream contender, explosive growth simply isn’t in the cards anymore.

  • avatar
    CoreyDL

    “as they prepare to increase global sales to just 4 percent this year”

    Can you correct this? It should be “as they have projected a sales increase of just 4 percent in 2014.”

    If they increased their global sales to just 4%, that means 96% of their product would go unsold. That wouldn’t be good business.

  • avatar
    Joss

    It’s all about putting cash on the hood of older models.

    • 0 avatar
      Atum

      This is exactly why the Elantra and Sonata sell so well, yet the Santa Fe and the Elantra GT are barely moving.

      • 0 avatar
        bd2

        You are mistaking the Corolla and Camry for the Elantra and Sonata (the latter 2 having higher ATPs).

        And Hyundai is selling all the Santa Fes that it can build (capacity constraint is an issue); as for the GT, it’s a higher priced Euro model.

  • avatar
    dwford

    Remember a couple years ago Hyundai decided to not build any more plants and cap it’s production to focus on quality? They are just hitting the wall of what they are capable of selling with their current production capacity.

  • avatar
    daviel

    Ajla: “I don’t know, anecdotal though it may be, the three people I know that bought new Kia/Hyundai vehicles (04 Spectra, 05 Sportage, 03 Elantra) all still have them on the road. I personally wouldn’t be afraid of them.

    I can’t speak at all for the newer stuff though.”

    Just my experience, but we have a 2011 Sorento, and a 2011 Sportage (see avatar). Zero trouble with either vehicle. Fine cars. I’d buy another Kia in a heartbeat – thinking about a 2014 Forte.

    • 0 avatar
      th009

      And my German snot brand premium vehicle is now over two years old, with exactly zero problems. Does that prove that all the rants about German reliability on these forums are wrong? Or are we both talking about anecdotal evidence?

      On truedelta.com, the Sportage and Sorento look OK (some years good, some average) but not any better than my German snot brand.

      @ajla, my wife’s 2004 GTI and my in-laws’ 2001 Jetta, neither one reputed to be a paragon of reliability, are both still running without major repairs, too. The dangers of relying on anecdotal evidence …

      • 0 avatar
        ajla

        I agree that the three examples I gave are hardly a perfect sample.

        However, did any of the usual suspects give the 04 Spectra, the 05 Sportage, or the 03 Elantra poor statistical reliability ratings? It seems like Hyundai/Kia have been considered average-ish on reliability for about a decade now.

        • 0 avatar
          daviel

          Anecdotal evidence is fine with me because it is the personal experience of owners of the vehicles. My only beef with VW (I have owned six – bug, old and new busses, scirocco, jetta, new beetle) is that they are expensive to repair in my part of the world. I love German cars, too. I like SAABs. I don’t pay any attention to the grand generalizations of critics in these comments who have not lived with the cars, but have fixed opinions based on whatever. Checking True Delta is a good idea – I report my data there.

        • 0 avatar
          th009

          @ajla, I was checking truedelta.com … but there are not enough data points for cars more than five years old to really draw conclusions about your Elantra/Spectra/Sportage, or my family’s GTI and Jetta. I think this is an artifact of truedelta having only been around a few years, so they don’t have a lot of data on older cars.

          From 2008 on, they are fairly similar, on average (in terms of the number of repair trips per year):
          Elantra: 30 15 43 39 25 4
          Golf: 19 18 47 10 30 10

          The thing I really like about truedelta.com is that it tells you which data points are not as reliable, so you can take those with a grain of salt.

  • avatar
    Nostrathomas

    Is it really that much of a big deal to just build a certain amount of cars, and build them well, without having to grow like a weed? I know the old adage “if you’re not growing you’re dying”, but it seems like every car maker out that has plans to take over the world with car sales.

    Hyundai and Kia focused on upping their quality over the last decade, and have done an admirable job of it (though I still think their cars feel a little disposable). Clearly it’s worked and they’ve grown their company in impressive ways because there’s now great value in their cars.

    However as soon as the shift goes from “Better” to “More”, you just know eventually they will slide. I’m sure they will sell more cars and make a little more money too, but at some point it will go all Toyota on them where the Value/Quality proposition that got them there will suffer.

    As soon as a company makes numbers their #1 priority (ie, what VW and BMW are doing these days) that’s usually a signal to put their cars on my Do-Not-Buy list.

  • avatar
    romismak

    Expected, they can´t grow much quicker with their decision to improove quality and not volume, i mean Hyundai/Kia could have 3 more plants and they would run on 100% capacity, if they had factoreis in NA, China or Africa/Middle east it would be great for them. in China next year Kia will start producing in 3rd plant with Dongfeng so Kia will boost sales in China at least, but overall i don´t see where they can grow besides China. I mean NA – both plants full capacity + won is stronger than before bad for exports from home factories to NA, in Brazil their great growth will come to an and when numbers will compare to alredy strong 2013 numbers, in Africa and Middle east HK are huge and can grow with market but they import a lot from Korea here so again strong won… at home in Korea the market is alredy big, it will stay in same numbers to this year + EU trade deal means Germans will do better there in 2014 so HK Group together probably will loose market share again, also SSangyong, Chevy and RSM are doing good job lately in Korea so also Korean automakers will eat more market share from them. Europe will rebound, but i think EU automakers will make big offensive here with market finally growing after 6 years i think they all will thry to gain market shares so hard job for Hyundai-Kia here. Anaway their projections are always conservative so i expect total sales in 2014 to be close to 8 million, but i think more than half of ,,add,, sales will come from China alone

  • avatar
    DeadWeight

    There is not a single Hyundai or Kia that I’d ever consider buying unless and until these companies learned to and/or did incorporate competitive suspensions in terms of ride quality and handling, which they have yet been able and/or willing to do.

    This is – now – in addition to the fact that the Koreans have lost their price advantage over the competition, and in some cases, actually cost more than the competition on an apples to apples comparison.

    Ride quality, whether the vehicle is a subcompact, midsized passenger sedan, sports coupe, CUV or wannabe luxury sedan contender, is at least tied as the most important vehicle attribute that I take into account when buying any vehicle, as I’ve learned the hard way that not ensuring one is going to enjoy a vehicle over all manner of road surfaces before purchasing a vehicle will inevitably lead to much pain, suffering and regret.

    Sadly, the only Hyundai that had what I’d consider to be a fairly competitive suspension setup was the Sonata, and even then, barely.

    The Tucson, Azera and Genesis Sedan were all among the worst vehicles I’ve driven in the last decade, specifically because of the horrid behavior of their suspensions.

    • 0 avatar
      VoGo

      Deadweight,
      You certainly have strong opinions, and that’s not a crime in my book. I would like to see you write a few columns for TTAC, if you can spare the time.

      • 0 avatar
        DeadWeight

        Thanks for the compliment.

        Others have suggested this, too, even if a few of them were probably doing so in order to try and channel my rants into a more palatable/constructive dialogue for the sake of their own sanity.

        I plan on reviewing the next rental car I receive or have access to, and forwarding it to Jack for publication, under the pseudonym of Mr. Piss & Vinegar.

        • 0 avatar
          tresmonos

          That would be something I would get a kick out of. Too bad I don’t live in MI, anymore or I’d ask to join you and provide some internal corporate auditing experience while getting drunk off my ass.
          Then I would type out my portion of the review while black out hammered. I did something along the lines of this for the Fiesta ST and sent it to Derek, but I don’t know if he’ll use it or not. It was very brazen and full of illicit innuendos and profanity. A lot of the review’s speeds would have landed me in jail had I done it in the states.

          • 0 avatar
            DeadWeight

            The irony is that I’d come to praise the suspensions of most current FoMoCo products by the relative standard of other cars in their class…

            And Tres, you know that I’d buy you several rounds of drinks no questions asked anytime that you’re back in the Tri-county Michigan area. The stories you share about hour time in the trenches of automotive warfare are the stuff that few people get to ever hear from a credible source.

          • 0 avatar
            tresmonos

            I will take you up on that offer, but we’ll first dispense my corporate dinner tab before we buy rounds. I went out with Kreindler and had a hell of a good time when I was putting out a fire at Oakville Assy Complex. I come up to Dearborn every so often to deal with quality issues with Ford (my customer, now). Let me know how you want to get in touch (fb, email, etc) – I have a junk email address I can share on this site without worry of spam as it’s already a catch all for spam selling chinese knock off’s of viagra: tresmonos ‘at’ hotmail ‘dot’ com

          • 0 avatar
            DeadWeight

            You’re on, Tres.

            Union Street is a place you’ve probably been. It’s a little hipster-ish but not too bad. Gusoline Alley in Royal Oak has obscure beers behind the barkeep’s stash and a most excellent juke box.

            We could hit up Mexican Village, or do a jaunt over to Mini if you like good Vietnamese food (where the Windsor Ballet is).

    • 0 avatar
      Xeranar

      Seeing as I’m no road warrior as some of you for changing vehicles and the only kia I road in the last few years was the new forte when I was considering it a year ago what is ‘competitive’ in your book? For their size they don’t seem very isolated but they weren’t bone-jarring.

      • 0 avatar
        DeadWeight

        I’m not ragging on H or K’s reliability or driveability or anything else (not that you implied that I was).

        Regarding the suspension behavior I complain of, it’s less an issue of harshness (although that can factor into the equation on what are billed as their premium offerings like the Genesis Sedan) than of idiosyncratic behavior, such as lateral movement and porpoising over broken or undulating pavement, or the rear suspension and front suspension not feeling as if they’re of the same vehicle.

        (Holy run on sentence.)

        I will say that the Azera I rented a while ago had the most odd suspension, while the Genesis Sedan had the most cheap & unrefined feeling suspension, compared to other vehicles in their respective segments.

        • 0 avatar
          bd2

          The Cadenza has a better suspension than the Avalon and probably the 2nd best in the segment next to the Impala.

          The Forte has a better suspension than either the Civic or Corolla.

          As for the Genesis, the non-R-Spec suspension is fine after some retuning; previously, there was an issue with the crappy OEM Dunlop rubber.

    • 0 avatar
      NormSV650

      DW is correct. I drove a Sportage EX(top of line minus turbo) and thought it drove like an ox cart. I was consiering the turbo version but the EX non-turbo was well into the $30′s. But the cooled seats were nice.

      • 0 avatar
        DeadWeight

        The Sportage and the Tucson both have appalling ride quality, IMO (well, the Sportage is at least rough, while the Tucson is brutal).

        All of our regular joking about turbos and such aside, GM and Ford are now at least the equal of, and in many cases way ahead of, the Japanese, and lighthearted ahead of the Hyundai/Kia when it comes to suspension tuning.

        Chrysler is also well ahead of the Koreans in this category, at least with its better offerings like the 300 and Jeep Grand Cherokee.

        Buick products easily meet or best even premium Japanese products in terms of ride quality and NVH levels, too (as do some FordFordss).

  • avatar
    motorrad

    I travel to Korea 6-7 times a year for business and routinely ride in Hyundai and Kia taxis with 500K+ kilometers on the odometer. Even saw a couple with over 700K. I’m not sure how many engine and/or transmission rebuilds were done but the cars themselves seem pretty stout.

  • avatar
    28-Cars-Later

    Don’t worry, K nine thouuuussaand will save the day.

  • avatar
    Big Al from Oz

    I’m a fan of Hyundai and Kia. I think they have improved their quality and range of vehicles quickly. Probably better than any other manufacturer has ever achieved.

    I see the Japanese manufacturer’s hampering the progress made by Hyundai/Kia. In our region the Japanese manufacturers are using Thailand to manufacture many of their vehicles, even the more budget vehicles.

    This budget area has been where Hyundai/Kia have been quite successful. Since they’ve gone ‘upmarket’ the competition has intensified with the Japanese.

    Korea is a cheap manufacturer of vehicles compared to Australia, but expensive when compared to the Thai’s who’s GDP is on par with the Chinese.

    Hyundai/Kia are going to rethink how they are operating. Maybe offshore some manufacturing in the Asia/Oceania region, maybe into China or Thailand.

    Hyundai’s and Kia’s Korean auto workers will take an aggressive stance if any production is off shored. I could allude to another auto workers union that never had vision of their longer term position and sustainability.

    Hyundai/Kia have a problem to overcome. If they become competitive and produce even better vehicles they could lead the world. Look at what they’ve already achieved in a few short years.

    They have to become more competitive and progress and not become insular and protective.

    • 0 avatar
      DeadWeight

      Koreans are really smart, technically proficient people, with a strong engineering resource pool, which makes it all the more curious to me why they can’t seem to nail suspension design (assuming I’m correct).

      I’ve often wondered if European only Korean cars like the Hyundai Cee’d that was the Top Gear reasonably priced car are qualitatively different than what we get in the states in terms of suspension design.

      • 0 avatar
        Pch101

        For decades, mainstream automakers have designed cars differently for Europeans than they have for Americans. It has long been presumed that Europeans comprise a continent of frustrated race car drivers who want nimble handling, while Americans get more displacement and ride comfort.

        I don’t know whether your assumptions are correct in this case, but it wouldn’t surprise me if the Cee’d handled differently from the Forte, or the i30 from the Elantra.

      • 0 avatar
        Big Al from Oz

        @Deadweight
        Up until very recently the Koreans were an extension of the Big 3 with links to the Big 3′s Japanese partners.

        Korea tended to produce old platforms and engines with the latest emissions controls fitted. In other words the Japanese had a strong influence with the Big 3 on the direction the Korean manufacturers headed in.

        Now, Hyundai/Kia are on their own with their own designs. A lot of the current technology/engineering they are using is ‘imported’ from Europe, even specially picked designers and engineers. But there still appears to be the legacy of the Japanese/American influence.

        It will be interesting to see how the next generation of Hyundai/Kia perform.

        Daewoo is in a different boat, in that it is heavily involved with GM still.

  • avatar
    JK43123

    My wife thinks her Mercury Grand Marquis rides better. I think my Sonata rides better. Go figure.

    John

  • avatar
    Big Al from Oz

    Hmm….

    http://www.reuters.com/article/2014/01/03/us-hyundai-sale-idUSBREA0206H20140103


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