QOTD: Are Hyundai's Troubles Nothing A Few SUVs Can't Fix?

Timothy Cain
by Timothy Cain
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qotd are hyundai s troubles nothing a few suvs can t fix

This is not what you’d call a long history of sales difficulties for Hyundai, the seventh-best-selling auto brand in America. The 2016 calendar year was Hyundai Motor America’s best ever, the culmination of eight consecutive years of growth.

Yet while Hyundai rapidly — and not unpredictably — grew its U.S. sales coming out of the recession, nearly doubling its sales between 2008 and 2016, the rate of growth was notably slower in 2016 than in prior years. Blame capacity constraints, blame a car-centric lineup in an SUV-leaning world, blame conservative redesigns, blame whatever you want.

Regardless, Hyundai is feeling the pinch now. Year-over-year, sales have declined in each of the last six months. Hyundai’s U.S. CEO, Dave Zuchowski, was ousted just before Christmas 2016. In May 2017, for the first time ever, Kia outsold Hyundai in the United States. And on June 6, 2017, Hyundai Motor America’s vice president for sales, Derrick Hatami, exited the building as well.

All is not well. So then, more SUVs?

Perhaps, but is Hyundai really lacking in the SUV/crossover sector?

Hyundai’s utility vehicle lineup is just as big as Honda’s. The Tucson, Santa Fe Sport, and Santa Fe stack up against the HR-V, CR-V, and Pilot, and where are the accusations that Honda’s utility vehicle lineup is found wanting?

Indeed, heading into May, Hyundai wasn’t short on SUV/crossover supply, either. According to Automotive News, Hyundai had a 72-day supply of utility vehicles as of May 1; a 46-day supply of passenger cars. Meanwhile, Hyundai is increasing the value quotient of its bigger utility vehicles. Hyundai will also eventually add the Kona subcompact crossover at the bottom of the lineup to take on the Honda HR-V.

But the Kona’s timing speaks to Hyundai’s slow reaction to the SUV/crossover craze. Competitors already exist at Buick, Chevrolet, Fiat, Honda, Jeep, Mazda, Mini, Mitsubishi, Nissan, and Subaru. The Santa Fe is more than four years old; the Santa Fe Sport is in its fifth model year. Freshness helps: the not-quite two-year-old, third-generation Hyundai Tucson just reported its best month of U.S. sales ever.

In fact, year-to-date, Hyundai’s three-pronged utility vehicle division is up 20 percent. But while the U.S. market leans on light trucks for more than 60 percent of its sales, Hyundai brand relies on a car division (that’s lost 16 percent of its sales so far this year) for nearly 70 percent of its U.S. volume.

Perhaps Hyundai’s early 2017 downturn is a blip on the radar. Maybe Hyundai can turn the ship around in the second half, during what’s expected to be a market-wide decline.

But if not, what would you do to fix Hyundai Motor America’s current difficulties?

Timothy Cain is a contributing analyst at The Truth About Cars and Autofocus.ca and the founder and former editor of GoodCarBadCar.net. Follow on Twitter @timcaincars.

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  • Mmreeses Mmreeses on Jun 08, 2017

    Hyundai thinks that they are "premium" mainstream when in the US they're still the value mainstream guys. Hyundai had a chance to be the new Honda/Toyota----but it's looking like that they blew it by allowing to many non-honored warranty claims and skimping on 100,000+ mile durability.

  • Quaquaqua Quaquaqua on Jun 08, 2017

    This is like the 5th article that's mentioned problems at Hyundai which basically aren't problems. I don't understand why this is a topic. They're doing fine. Their product mix is off. The only reason they didn't rush a subcompact CUV to the market is because, unlike GM, they didn't have one waiting in the wings. Ford does, and they still haven't brought it here!

  • The Oracle I was in WNY when this went down and it is likely a medical issue and/or some type of rolling domestic. That car was flat out with air bags deployed before it even left the ground. It was a spectacular wreck. The couple made a 7-minute stop at the Seneca Niagara Casino before the fiery launch, and something went terribly wrong in those 7 minutes.
  • Lorenzo A union in itself doesn't mean failure, collective bargaining would mean failure.
  • Ajla Why did pedestrian fatalities hit their nadir in 2009 and overall road fatalities hit their lowest since 1949 in 2011? Sedans were more popular back then but a lot of 300hp trucks and SUVs were on the road starting around 2000. And the sedans weren't getting smaller and slower either. The correlation between the the size and power of the fleet with more road deaths seems to be a more recent occurrence.
  • Jeff_M It's either a three on the tree OR it's an automatic. It ain't both.
  • Lorenzo I'm all in favor of using software and automation to BUILD cars, but keep that junk off my instrument panel, especially the software enabled interactive junk. Just give me the knobs and switches so I can control the vehicle, with no interconnectivity of any kind.