By on April 26, 2017

[Public domain]

The frustration never seems to end for Hyundai executives. After last year’s Korean labor strife and political scandal, the brand now faces flagging fortunes in the all-important North American market, all thanks to a car-heavy lineup that once guaranteed piles of profit.

Now, the automaker faces the same problem in another global growth engine — China. While that market has also discovered its love for crossovers and SUVs, there’s another problem that Hyundai can’t turn around by rushing a new vehicle to production. Hyundai, it seems, can’t do a damn thing about high-altitude defensive missiles.

Already battered by the Chinese crossover craze — which has seen competitors like General Motors clean up — Hyundai has become a victim of geopolitics.

Anti-Korean sentiment is nothing new to China, but the growing distrust and boycotting of South Korean products — a practice tacitly encouraged by the country’s Communist government — has hit a new high. In response to the nuclear ambitions of North Korea, a key Chinese ally, the South is literally on the defensive. Recently, news emerged that South Korea plans to deploy a U.S.-supplied Terminal High Altitude Area Defense (THAAD) missile battery.

With the first pieces of the missile shield now in place, the system should be fully operational by the end of the year. China isn’t pleased.

According to Bloomberg, Hyundai showrooms in the largest Chinese cities are ghost towns. A manager in a Shanghai dealership told the news agency that weekends will go by without a single person entering the showroom, and that half of his sales staff have already quit.

Reuters reports Hyundai and Kia sales fell a staggering 52 percent in March, year-over-year, as the boycott ramped up. Market share has shrunk to just 3.5 percent. As the automaker counts on China for about a quarter of its overseas sales, the THAAD battery keeping its Seoul headquarters safe from nuclear annihilation won’t save it from that incoming blow. Still, the company persists.

Hyundai plans to offer seven new China-only vehicles, including a gas-powered and electric SUV, to lure Chinese buyers into showrooms. Doing its part, Kia also has a China-only SUV the way.

Beijing Hyundai Motor Company executive Chang Won-shin holds out hopes that anti-Korean sentiment will blow over, telling Bloomberg he expects the business climate to “get better soon.” The company is expected to drop its first-quarter financial report later today, with Kia’s results coming tomorrow.

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43 Comments on “Sedans and Missiles: Hyundai Slams Into Another Sales Roadblock...”


  • avatar
    slavuta

    “… the THAAD battery keeping its Seoul headquarters safe from nuclear annihilation”

    this is a joke. Seoul can be easily reached by conventional artillery.

    • 0 avatar
      highdesertcat

      The key word is “nuclear”.

      Conventional artillery, especially the 155mm and up, is bad but not as devastating.

      • 0 avatar
        28-Cars-Later

        Atomic Annie.

        https://en.wikipedia.org/wiki/M65_atomic_cannon

        • 0 avatar
          highdesertcat

          Gen MacArthur wanted to nuke North Korea in 1952 (and China if need be) but Pres Truman stopped him.

          That’s when combat strikes decisions reverted from generals in the field to micro-management from the White House. Until now.

          Good to see Trump delegating decision-making to commanders in the field and the SecDef.

          • 0 avatar
            FreedMike

            Huh? Trump’s letting field commanders deploy nukes?

          • 0 avatar
            highdesertcat

            Nukes are not kept “in the field”.

          • 0 avatar
            FreedMike

            I don’t imagine so, but that’s not what I was asking, HDC. Has policy changed to allow field commanders or the Secretary of Defense to deploy nuclear weapons on their own, without presidential authorization?

          • 0 avatar
            highdesertcat

            That was brought out with the deployment (in theater) of the MOAB where Trump actually had nothing to do with the decision when to use the MOAB, but had delegated that authority to the Theater Commander.

            Trump said so himself.

            Commanders cannot use what they do not have. No nukes today.

            However, if it comes to that point, as should be brought out today at the Senate Briefing at the White House, I have no doubt that the Senators will be briefed on exactly that aspect of what Commanders are authorized to use at their discretion. Maybe even nukes (the ones that penetrate and explode underground).

          • 0 avatar
            FreedMike

            MOAB is a big-a** bomb, so I suppose it’d make some sense to delegate its’ use to field commanders, but it’s not a nuke. No way any president would delegate that authority to anyone but himself.

          • 0 avatar
            highdesertcat

            Read up on the decision to bomb Hiroshima and Nagasaki and how the decision was made, how it was delegated, and how it was executed.

            The “responsibility” ALWAYS remains with the President, but everything can always be delegated.

            Prior to Trump, the MOAB could not be used unless some 30-yo White House aide with a Liberal Arts Degree but without any military background would give the field commander the go-ahead.

            Things have changed! Scary.

          • 0 avatar
            slavuta

            MacArthur was sick in his head.

          • 0 avatar
            bd2

            Are we talking about the same tRump that stated that he knew “better” than the generals, but then turned around and demanded that the Pentagon come up with a plan to defeat ISIS in 30 days (which one retired General stated as being “sophomoric” – as in what does Trump think the Pentagon has been doing for these past years?).

            (Btw, this is the same tRump that touted time and time again during the campaign that he had a “great” healthcare plan that just needed minor tweaks and then once in the WH, stated that he never knew that healthcare could be so “complicated” – duh!)

            As for Truman stopping MacArthur from bombing the Yalu river with nuclear weapons – that was the correct thing to do.

            Generals/Admirals are hardly infallible – for example, in the planned Operation Downfall (proposed invasion of Japan), the military brass contemplated the use of chemical weapons as well as using nuclear bombs to support the invading ground force (on the premise that exploding the nuclear bombs via an “air burst” – some 1,800-2,000 ft above the ground would help clear the area and pave the way for ground troops with minimal residual radiation effects).

          • 0 avatar
            Lou_BC

            “Has policy changed to allow field commanders or the Secretary of Defense to deploy nuclear weapons on their own, without presidential authorization?”

            It would be much safer to have Generals have final say on nukes than #emptyshellpotus.

          • 0 avatar
            amca

            Reportedly, Mattis has told friends he took the Sec. of Defense job to “save the US military from Donald Trump.”

            Which makes me feel much better about ol’ Mad Dog.

          • 0 avatar
            Lou_BC

            @amca – Yes. I found it reassuring in an odd sort of way knowing that Mattis got the job. He did get Bannon out of the National Security Council and I bet he hammered home the value of NATO.

          • 0 avatar
            28-Cars-Later

            I believe it was McMaster who reshuffled the NSC, not Trump/Pence. What many don’t realize is the NSA is literally about the third (or sometimes second) effective boss of the administration. When Flynn was forced out on specious reasoning, I predicted it would be ex CIA director Petraeus to replace him. While I was wrong on Petraeus, McMaster is a protege of Petraeus. This is no accident. Flynn was part of a soft coup and a message to Trump, “we/our faction will have a seat at the table”. Trump relented (or made a deal) and McMaster took command of NSC. Since 1947 the NSC effectively runs the military and foreign policy of an administration and NSA is actually a very important post (IMO equal to Secy of State and Secy of Defense in terms of influence). The warmongers may not be running the whole show, but they again have tremendous influence as they have had since the Reagan administration.

            I’ve also read the deal Reagan made with ex CIA director GHW Bush was in exchange for Bush’s support within the MIC/Intelligentsia, Reagan was to allow VP Bush to run the NSC. I think a similar think happened to Trump, except in his case it was after the election as opposed to before.

      • 0 avatar
        FreedMike

        N. Korea would get some nasty licks in with all that artillery, but it seems to me that it’d all be very vulnerable to S. Korean / U.S. air strikes.

        My worry would be what happens after the North loses its’ artillery.

        • 0 avatar
          PrincipalDan

          The bigger questions would be what China would do if North Korea was the aggressor.

          The reason we didn’t “conquer” the whole Korean peninsula during the Korean Conflict was the Chinese.

          “You will run out of bullets before we run out of people.” – That was the message sent from China.

          • 0 avatar
            FreedMike

            I’d actually expect China to try and deter North Korea. They know that if they attack the south, it’ll trigger a war with the U.S. From China’s perspective, what good can come of that? I can’t see any.

            I think they want North Korea to be exactly what it is for as long as possible: a major pain in our a**.

          • 0 avatar
            highdesertcat

            North Korea was the aggressor that started the Korean War, and we all know where China came in.

            I don’t think anything has changed except that Trump won’t be taking lip service.

            Unless North Korea does something really, really stupid to provoke the US, nothing will happen this go-’round either.

            China cannot deal with millions of North Korean refugees fleeing across its border with North Korea.

          • 0 avatar
            Lou_BC

            “Trump won’t be taking lip service.”

            Really?

            That is all he is; lip service.

            Oh and brainless, thoughtless,morally and ideologically bankrupt.

        • 0 avatar
          28-Cars-Later

          Unless you see or hear reports of upper middle management fleeing the country, nothing will happen. However the conditions in which something *could* happen were cemented when Kim-Jong nam was brutally assassinated. I poured out a 40 for him.

          I’d also look to see if they move CVN 76 (Ronald Reagan) as opposed to CVN 70 (Carl Vinson) into position. I would start wearing 1,000,000 proof sunblock in Pyongyang should this occur. CVN 76 should about be done with it’s four month SRA.

          http://www.gonavy.jp/CVLocation.html

          “Selected Restricted Availability (SRA): Navy ships go through regular periods of maintenance, repairs and upgrades, known as Selected Restricted Availability. Typically ships in SRA are unavailable unless extreme conditions warrant. Work includes tank preservation, propulsion and ship system repairs and limited enhancements to various hull, mechanical and electrical systems.”

          http://www.globalsecurity.org/military/systems/ship/scn-milestones.htm

          • 0 avatar
            FreedMike

            Just out of curiosity, why would it make a difference what carrier gets sent?

          • 0 avatar
            highdesertcat

            Some Carriers are more capable than others, with more modern weaponry and with a greater variety of strike-weapons.

          • 0 avatar
            FreedMike

            Well, the only weapons a carrier would ever deploy itself would be point defenses – AFAIK they don’t carry offensive weapons per se (the air wing is the offensive weapon). All the land-attack weapons would be carried by the battle group (the cruisers/destroyers/attack subs).

            So, does the Reagan’s battle group have better offensive weapons than the Vinson’s? Or can the Reagan carry more planes than the Vinson? Just curious.

          • 0 avatar
            highdesertcat

            Carriers carry all sorts of weapons, including offensive ones, like dumb-bombs, all sorts of different JDAMs, and Aerial-Rocket-Artillery in pods.

            And that’s just for air-to-ground use.

            Air-to-air weapons also get very offensive, at the detriment of the aggressors.

            Libya found that out during the ’80s, and those were standard AIM-9 and AIM-7 Air-to-Air missiles.

            Things have improved by leaps and bounds since that time.

            Currently, there is no equivalent to the AMRAAM missile.

            I don’t know about what the differences are between Carrier capabilities, but I’m sure the Vinson can do the job.

          • 0 avatar
            FreedMike

            Right, but that stuff is deployed by the air wing, versus the carrier itself. The only weapons a carrier can fire on its’ own in anger are the point defense systems (CIWS, anti-air missiles, etc), which would obviously be useless against ground targets.

            Who knows? Maybe Reagan has more storage space for stuff that goes “boom” that ends up under the wings of the aircraft. Not sure what 28 was referring to.

            And if North Korea tried a launch an air attack on a US carrier battle group, it’d be futile. Even if the air wing failed to stop the attack (highly unlikely), the AEGIS cruisers and destroyers all have anti-air weapons that would take out any air threat within a hundred miles. The anti-air missiles on a carrier are just a last ditch defense.

          • 0 avatar
            28-Cars-Later

            @Freed

            I’m not sure on Vinson vs Reagan in terms of fighter groups. The reasoning is simple, the Reagan was irradiated during the Fukushima disaster. There is a lawsuit going on about it right now as many sailors have been affected and the Pentagon has stonewalled them.

            “The sailors participated in Operation Tomodachi five years ago, providing aid to Japan after its earthquake and tsunami.

            A magnitude 9.0-earthquake struck off Japan’s shore on March 11, 2011 and triggered a devastating tsunami that killed more than 18,000 people. The ocean flooded the Fukushima Nuclear Power Plant leading to a loss of the plant’s cooling systems. Several explosions released radiation into the atmosphere.
            Many of the sailors say doctors refused to connect their illnesses with the radiation exposure.

            “You have to experience it,” said William Zeller. “You have to experience the doctor telling you to your face. You have to experience the years of pain when everyone tells you ‘You know you’re fine.’”

            More than 400 sailors, including the 10 who met Koizumi in Carlsbad, are involved in a lawsuit trying to reconcile the service members’ illnesses and the radiation exposure. Amidst politics and lawsuits, the sailors called Koizumi’s visit an incredible act of kindness.”

            http://www.nbcsandiego.com/news/local/Fukushima-Radiation-Ronald-Reagan-Sailors-Japan-379941261.html

            http://www.japantimes.co.jp/community/2016/11/02/voices/japans-government-stay-u-s-sailors-lawsuit-tepco/

            https://www.stripes.com/news/former-senator-pledges-to-support-vets-in-fukushima-lawsuit-1.426394

            https://www.law360.com/articles/780512/9th-circ-agrees-to-speed-up-sailors-1b-fukushima-suit

            Depending on how bad the Reagan was damaged by the Fukushima, and how radioactive *it still is*, the carrier may become the new USS Maine in an opening gambit with the Norks. Imagine “Remember the Reagan” with a nationalist at the helm.

            Hold on to your butts.

          • 0 avatar
            highdesertcat

            FreedMike, we’d have to look at the current, modern definition of the word “Weaponsystem”.

            WWII history tells us that the US Carriers as deployed after the devastation of Pearl Harbor, were designated as America’s offensive weapons against the then predominant Japanese in the Pacific.

            In the Atlantic Theater it was the Canadian/American anti-UBoat campaign that allowed American B17s and British Lancaster Bombers to be the predominant offensive weapons against Germany, once the Liberty Ships could resupply England and the Russians, while the British Spitfires were primarily England’s Air Defense weaponsystem during the Battle of Britain.

            No doubt, American Carriers even today carry a much bigger punch by being able to project power unlike any other nation on this planet, than their predecessors ever did.

          • 0 avatar
            highdesertcat

            28-Cars-Later, since you brought it up: it was the Radiation Badges of the Reagan’s reactor crews that first indicated that those wearing them had been exposed.

            There was a frantic search aboard the Reagan to see if there was a breach aboard, before someone realized that the contaminated debris and dust had come from Fukushima.

            I hope the Navy handles this better than they did the explosion in the gun turret of the USS Iowa.

            Not to mention the VA.

          • 0 avatar
            28-Cars-Later

            From what I read it looked like they covered it up, just like most of the details about Fukushima. I may be mistaken but I believe they were originally suing the Navy as well to release what it knew about the incident and aftermath to the general public. This was dismissed I believe on national security grounds and the tactic changed to suing TEPCO so the families of dying sailors could have something. Essentially its Gulf War Syndrome all over again for the sailor’s families.

            The more interesting thing is how damaged was the Reagan? If the [believed to be] MOX exposure from the Reactor 3 explosion cannot be re-mediated, it is a radioactive hulk waiting to be scrapped, if it can even safely be scrapped at all. Next possibility is to send it to the bottom in some manner, assuming the situation is that severe of course. Why not do so in order to get a rise from the public to wreck NK?

          • 0 avatar
            highdesertcat

            28-Cars-Later, from what little I know, you are right on all counts.

            I do know that the people who were stationed on board at that time are very worried about the future complications later in their lives, like the survivors of Hiroshima and Nagasaki who experienced delayed-onset aftereffects.

          • 0 avatar
            28-Cars-Later

            If that’s really their plan for it, dangerous times. I do hope I’m wrong.

          • 0 avatar
            DevilsRotary86

            Freed, in direct answer to your question, it does not really matter which carrier gets sent but there are differences. All the currently serving US aircraft carriers are of the Nimitz class. However, the lead ship USS Nimitz was laid down in 1968 and the final ship the USS George HW Bush was laid down in 2003, giving 35 years between the first and last. The Nimitzes are in 3 “flights” or production runs. The first is Nimitz, Eisenhower, and Vinson. The second is Roosevelt, Lincoln, Washington, Stennis, and Truman. The final flight is Reagan and Bush. So the Vinson is amongst the oldest flight of carriers (1975) and the Reagan is amongst the latest (1998).

            Now what is different? Well, the final flight gets better and safer ordnance magazines. Better and more advanced steel was used and the flight deck was better armored, giving it better protection. The island design on the Reagan is different lending to better control of the airwing. Finally, the radars and computer systems on the Reagan are more up to date than the Vinson’s. Finally, it’s subtle, but supposedly the flight deck and hangar were “feng shui’ed” to make ordnance handling, arming, maintenance, fueling, launching, and recovering more efficient.

            In car enthusiast terms, it’s a lot like the difference between a 1960 Dodge Dart and a 1976 Dodge Dart. Both are Darts, both have similar engine options; either a Slant 6 or a B-series V8. Both have similar transmissions available. But the 1976 benefits from about 15 years of little fixes and tweaks and partial redesigns. The later car is going to be just abit better and just abit faster and just abit more reliable.

          • 0 avatar
            RobertRyan

            @Freedmike
            The MOAB is the equivalent of the ” Earthquake” Bomb used in WW2 to destroy the Nazi Submarine pens

        • 0 avatar
          bd2

          By that time, much of Seoul would be in ruins with hundreds of thousands of civilians dead.

      • 0 avatar
        slavuta

        We saw what 2 bombs in form of planes can do to modern downtown. If NK strikes downtown with barrage of reactive and regular artillery, it will be as good as nuke.

  • avatar
    SCE to AUX

    Can we assume the same plight has befallen Samsung and LG in the Chinese market, or is there something unique about the car market in this political game?

    • 0 avatar
      highdesertcat

      My understanding is that the Chinese military will be modernizing during the next two 5-year plans.

      Read The National War College pubs, if you can get access.

      So the short answer is NO, that same plight has NOT befallen Samsung and LG in the Chinese market.

      Remember when Saddam wanted to buy all the Gameboys he could get his hands on for the internal processors?

    • 0 avatar
      bd2

      The PRC leadership has pretty much stoked a boycott of everything South Korean (like they did with the boycott of Japanese products earlier).

      It has gotten so petty that state CCTV wouldn’t even show a close-up of the South Korean golfer who won an LPGA tournament held in China a couple of months ago.

  • avatar
    NN

    Samsung only has a 6% market share in mobile phones in China, and LG has less than that. Apple as about 8.5%. The rest is all Chinese brands (Xiaomi, Huawei, etc.). Samsung had nearly 20% just a couple years ago, but the Chinese brands have since captured it.

    Seems a similar thing is happening with Chinese car brands, taking market share from foreign companies. Expect it to continue, save for the really premium brands with strong brand definition. Once the Chinese branded products are equivalent in quality, the consumers switch, so foreign brands have to do something to stay differentiated.

    Interestingly, the Chinese are taking all of the angst on South Korea (and Hyundai/Kia), when the missile system is being supplied by the USA, much to the chagrin of many South Koreans, even. China isn’t boycotting Ford, GM, Jeep, or Apple for that matter. The whole Korean peninsula is a pawn right now between the US & China. China has turned back coal ships from North Korea, a hit on their ally economically, and stirred xenophobic angst against S. Korea, hurting their businesses (our ally). Tit/Tat.

  • avatar
    Rick T.

    Something I wasn’t aware of until recently: Russia also has a border with North Korea.

    “Vladimir Putin is sending troops and equipment to Russia’s border with North Korea over fears the US is preparing to attack Kim Jong-un.
    The Russian President fears there will be a huge exodus of North Korean refugees if his American counterpart, Donald Trump, launches military action against Pyongyang.”

    http://www.dailymail.co.uk/news/article-4428384/Putin-sends-troops-Russia-s-border-North-Korea.html

  • avatar
    -Nate

    Politics & history .
    .
    -Nate


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