Hyundai’s 2010 Goal in the US is 500,000 sales and 4.5% Market Share

Korean automaker has seven new model launches in 2010, plans aggressive marketing campaigns this year, and, although this wasn’t in the plan, is also benefiting from Toyota’s troubles

By Brendan Moore

02.16.2010

Hyundai logoHyundai sales went up in a decidedly down US market in 2009, and the company sees blue skies in an improving market in 2010. Their sunny prediction is that Hyundai will go from 4.2% percent market share last year to 4.5% this year. To do so, the Korean manufacturer will need to hit 500,000 unit sales.

Hyundai sales in the US jumped 8% last year, going to 435,064 units in a market that crashed downward 21% overall. The company jumped an amazing 1.2% in market share, going from 3% to 4.2% in a single year.

Company officials are quick to say that they don’t think they can match that sort of market share growth this year, but that they feel that there is a “really good chance” that they will hit 500,000 sales this year for the first time ever, according to Dave Zuchowski, US sales chief of Hyundai.

Zuchowski went on to say that, “The 500,000 number is a magical number for us.”

However, Hyundai may make its numbers and then some, due to the stumble of the 800-pound gorilla that is Toyota. When the company was putting together its more modest forecast for sales increases in 2010, it factored in a stronger GM and Chrysler, two competitors that were in an eviscerated state in 2009 due to their respective federal bankruptcies. But it did not factor in a Toyota staggered from recalls and a drop in consumer confidence.

Zuchowski stated that before the recalls, around 6% of Hyundai’s trade-ins were Toyotas. Since the recall, that number has jumped up to 11%. Toyota is the brand most Hyundai buyers shop against, he said.

“In the past few weeks, we have virtually not lost anyone to Toyota,” Zuchowski said.

The Hyundai executive went on to say that their data shows that Hyundai is benefiting most in terms of “intenders,” people who are now considering both Toyota and Hyundai together when starting their car shopping process. Zuchowski claims that percentage has really spiked since the start of Toyota’s recall troubles.

2011 Sonata

2011 Hyundai Sonata

Although it may seem that company officials are being a bit too giddy, this may actually be a case of undue modesty and restraint on their part. Hyundai dealers are already running out of certain vehicles, most notably the new Sonata and the Tucson. Dealers say that some people are buying the Sonata without even driving the car – their only concerns are color, options and date of arrival.

Its difficult to envision a scenario in which Hyundai won’t make its sales goals this year, given their strong product lineup, the planned marketing push, and the unanticipated (but welcome, from Hyundai’s point of view) meltdown by Toyota. It is widely believed that the competitors that will benefit most from Toyota’s stumble are Honda, Ford and Hyundai. The only question is how the numbers will pan out at the end of the year in terms of which company records the greatest benefit, courtesy of Toyota.

Given their recent history, I wouldn’t bet against Hyundai.

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Author: Brendan Moore

Brendan Moore is a Principal Consultant with Cedar Point Consulting , a management consulting practice based in the Washington, DC area. He also manages Autosavant Consulting, a separate practice within Cedar Point Consulting. where he advises businesses connected to the auto industry. Cedar Point Consulting can be found at http://www.cedarpointconsulting.com.

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9 Comments

  1. Hyundai will do 540,000 sales in the U.S. this year – you read it here first. Everything’s going their way, their cars are much better-looking than Toyotas, even if the quality was equal. But it’s not, because Hyundai has BETTER quality than Toyota.

    Toyota owners will desert Toyota in droves and figure out where the Hyundai dealership is in their town, and go over there and buy a new Sonata instead of a Camry that might kill them.

  2. My prediction is right in line with Vargas. Hyundai will sell around 540,000 units in the US this year. They will benifit from 3 things:

    1) They will gain market share from Toyota.

    2) They will benifit from overal increase car sales due to pent up demand.

    3) Demographics. Hyundai’s primary buying demographic is the first time new car buyer. Young people today have no clue how bad Hundais uses to be, so as more young people enter the work force they have more potential customers.

    And honestly, their offerings simply LOOK much nicer than the Japanese offerings. I’ve had plenty of these as rental cars, and while not exactly my cup of tea (I’d rather have a Ford) they compare very favrably to the Hondas and Toyotas I’ve driven.

  3. Well before abandoning Toyota altogether I would check out the several TSBs issued on for various Hyundai models, some 6 years after production, for transmission and throttle solenoid issues related to sudden acceleration.

    For Hyundai to sell 60,000 more units this year in the US isn’t really all that ambitious considering the debut of a brand new Sonata and Tucson, models which already the top sellers for the company.

    Many current Sonata owners previously were either Camry or Accord owners. But when Camrys and Accords, basing at $19K, were being optioned with V6s and selling at $30K, a well optioned $25K Sonata was a mighty tasty alternative.

  4. Hyundai and Kia really seem to have their act together lately. The quality scores are way up, the cars are class-leading in fuel efficiency, and the design has improved by leaps and bounds. I’d dare say that the 2011 Sonata – while similar to the current Lexus ES350 in profile – is the best-looking car in its class. (Not a big fan of the very obvious hood cutline with the chrome moulding, though). The Sonata is also the lightest midsizer with the most powerful four cylinder. Sounds good to me.

    Incidentally, this is not the first time Hyundai thought it would hit the magic half-million mark. This is probably its best chance of actually doing it to date, though.

  5. Hyundai’s climb is a good lesson for GM and Chrysler – you can redeem your brand if you just keep improviing your product. It takes a long time but the payoff lasts longer than just getting a new marketing campaign.

  6. I think Honda will benefit more than Hyundai. Toyota owners are not known for risk taking and Hyundai is too much of a risk. I think Honda will pick up most of those customers.

  7. Taciz, I would have initially thought so too, but didn’t Honda also have a huge recall last week?

  8. Mark in AZ – Yes, Honda had a recall, but not for anything that might injure you. My personal experience in talking to people is that an occasional recall is acceptable (all machinery breaks, right) for their car, as long as it’s not for something that might cause death or injury. Then it’s a different story for consumers.

    But regardless of what Honda and Ford do to get Toyota’s customers, I think Hyundai is going to have a strong pull on those defectors. Hyundai has got momentum and pricing on their side. And some of their new stuff is really nice looking, as others here have mentioned.

  9. Damn, they could do close to 600,000 if the economy recovers and Toyota doesn’t. Think about it.

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