Tale of Two Countries: U.S. Finds Itself With Oversupply of Hyundai Model

tale of two countries u s finds itself with oversupply of hyundai model

South Korea moved swiftly to counter a coronavirus outbreak back in February, soon becoming a best-case example for other countries to follow. While domestic auto production was mildly hampered by the outbreak, and further impacted by supply chain issues originating in hard-hit China, output has barely flagged.

In the case of one popular compact crossover, perhaps Hyundai should have turned off the taps for a bit.

As reported by Reuters, too many units of the normally popular Tucson are piling up at U.S. ports, wallflowers in a nearly shuttered industry that’s only just now trying to get back on its feet.

Roaring out of the virus scare and anticipating normal overseas demand, Hyundai output in South Korea reached 98 percent of capacity in March, with the U.S. — a huge market for the automaker — receiving a greater than normal amount of vehicles last month. Shipments to the U.S. rose 4.3 percent, year over year, in March… just in time for lockdown measures in most U.S. states and the shuttering of dealer operations almost from coast to coast.

Suffice it to say there wasn’t a flood of buyers entering Hyundai showrooms in March, which explains why the healthy shipments of overseas-built models are clogging port facilities. As the brand’s best-selling model, the Tucson is over-represented in this slow-to-drain backlog, sources claim.

Hyundai has since idled its domestic Tucson line as it braces for an unhealthy first-quarter earnings report. April output in South Korea is expected to decline significantly as the company matches production with demand. However, last week’s assembly shutdown will do nothing for the glut of existing models U.S. dealerships don’t need.

“I hope that the situation will recover by the middle of next month. If not, we might have to lay off some people,” Brad Cannon, general manager of a California Hyundai dealership, told Reuters. The dealership’s sales are off 50 percent from pre-pandemic levels, he added.

Hyundai’s U.S. manufacturing sites are expected to get back to work in early May, though consumer demand moving forward is anyone’s guess. Most, if not all, automakers are readying for a bad sales year. On a brighter note, sometime later this year those same buyers will be able to take a peek at the next-generation Tucson, which arrives for 2021 with a new platform and less anonymous styling.

[Image: Hyundai]

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  • Volvoguyincanada Volvoguyincanada on Apr 23, 2020

    The Tucson is a rickety P.O.S. (Yes I have driven one). I don’t care about the “value”. The whole car shakes like an unbalanced washing machine every time I go over a bump in the road. Hyundai is the Samsung of the auto world.

    • See 1 previous
    • Bd2 Bd2 on Apr 24, 2020

      So what does that make the RAV-4? MT comparison test. Tucson - Its ride and handling behavior is similarly inoffensive. "The Tucson took a set in turns quite predictably and generally exhibited little or no bad behavior," technical director Frank Markus said. RAV-4 - The RAV4's ride quality is BOTTOM of the pack, too, with lots of head toss, gut jiggle, and a fair amount of roll through corners. We expected better. And the RAV-4 is on Toyota's latest platform, TNGA, whereas the Tucson won't be getting Hyundai's new platform until the next generation. MT also roasted the RAV-4 for its buzzy engine and rough shifting transmission. The RAV-4 didn't fare much better in C/D's comparison.

  • Thelaine Thelaine on Apr 23, 2020

    I thought Samsung was good. I have their TVs and a 'fridge. Tell me more about Samsung.

    • Art Vandelay Art Vandelay on Apr 23, 2020

      They are fine. Solid hardware if you can live with there "love it or hate it" interface tweaks. I am a Pixel user so it stands to reason I hate their interface. But stock Android on their hardware would make for an excellent experience in my mind, as would be the case for LG devices.

  • Ronnie Schreiber Hydrocarbon based fuels have become unreliable? More expensive at the moment but I haven't seen any lines gathering around gas stations lately, have you? I'm old enough to remember actual gasoline shortages in 1973 and 1979 (of course, since then there have been many recoverable oil deposits discovered around the world plus the introduction of fracking). Consumers Power is still supplying me with natural gas. I recently went camping and had no problem buying propane.Texas had grid problems last winter because they replaced fossil fueled power plants with wind and solar, which didn't work in the cold weather. That's the definition of unreliable.I'm an "all of the above" guy when it comes to energy: fossil fuels, hydro, wind (where it makes sense), nuclear (including funding for fusion research), and possibly solar.Environmental activists, it seems to me, have no interest in energy diversity. Based on what's happened in Sri Lanka and the push against agriculture in Europe and Canada, I think it's safe to say that some folks want most of us to live like medieval peasants to save the planet for their own private jets.
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  • MaintenanceCosts There's no mystery anymore about how the Japanese took over the prestige spot in the US mass market (especially on the west coast) when you realize that this thing was up against the likes of the Fairmont, Citation, and Volaré. A massacre.
  • MaintenanceCosts Chevy used to sell almost this exact color on the Sonic, Bolt, and Camaro, as "Shock." And I have a story about that.I bought my Bolt in 2019. Unsurprisingly the best deal came from the highest-volume Bolt dealer in my very EV-friendly area. They had huge inventory; I bought right when Chevy started offering major incentives, and the car had been priced too high to sell well until that point.Half the inventory had a nice mix of trims and colors, and I was able to find the exact dark-gray-on-white Premier I wanted. But the real mystery was the other half of the inventory. It was something like 40 cars, all Shock on black, split between LT and Premier. You could get an additional $2000 or so off the already low selling price if you bought one of them. (Neither my wife nor I thought the deal worth it.) The cars were real and in the flesh; a couple were out front, but behind the showroom, there was an entire row of them.When I took delivery, I asked the salesman how on earth they had ended up with so many. He told me in a low voice that a previous sales manager had screwed up order forms for a huge batch of cars that were supposed to be white, and that no one noticed until a couple transporters loaded with chartreuse Bolts actually showed up at the dealer. Long story short, there was no way to change the order. They eventually sold all the cars and you still see them more often than you'd expect in the area.