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Hyundai hits overdrive

Hyundai targets industry-leading quality among a host of bold new plans

Hyundai logo27 May 2005

INDUSTRY-LEADING quality, a global emphasis on all-new models including diesels, hybrids and fuel cells, a motorsport return and rear-wheel drive platform are looming large at Hyundai.

That was the message from the world’s seventh-biggest manufacturer at the recent Seoul motor show.

While still determined to reach a top-five global sales position by 2010, the Korean auto giant said achieving and maintaining industry-leading quality levels was a higher priority than becoming the world’s number one in terms of outright sales.

The company is now striving to top Toyota in quality surveys by 2008. It has already headed a JD Power quality assessment survey in the United States.

Until recently, the Hyundai Automotive Group – which includes Kia Motors – had long-term ambitions of overtaking General Motors with a combined 5.7 million units annually.

Last year, its sales passed the two-million mark for the first time.

Fuelling this growth is a 30 per cent volume rise in India, while in China the Elantra leads its segment with 250,000 sales annually.

In 2005, HMC expects to nudge 2.4 million.

Three all-new models this year – the TG Grandeur, a new people-mover based on the Portico Concept, and the MC Accent – should help achieve that milestone.

Beginning in 2006, HMC will also attempt to snare some of the environmental kudos enjoyed by Toyota and Honda, with petrol-electric hybrids mainly for the United States market and improved diesel engines for European markets.

A hybrid MC Accent (as well as a Kia Pride/Rio version) is pencilled in for North American sales beginning in the second quarter of next year.

Meanwhile, the new diesel recipients will include the fourth-generation Elantra, Grandeur and Sonata, all due soon, the coming Santa Fe II and the facelifted Getz from around October. The latter form part of a greater European market product offensive.

HMC also said it recognises the longer-term vitalness of zero-emission vehicles, and is keen to show the world its fuel cell expertise as well as the vast sums it is spending on it.

Communicating all of the above activity globally is HMC’s "Drive Your Way" advertising tag line.

Curiously, Hyundai Motor Company Australia (HMCA) has rejected this line because it is only a few months into the locally developed "Future Driven" campaign.

HMCA spokesman Richard Power said that the Australian slogan better illustrated where Hyundai was heading.

The return to the international motorsport arena will commence with the 2008 World Rally Championship season, although Hyundai will enter a vehicle in the latter stages of the 2007 campaign.

A vehicle built on an extended variation of the MC Accent platform will spearhead the rally assault.

Such actions are seen by HMC as helping the Hyundai brand to mature. Only then, the company said, can it consider navigating into luxury brand territory.

HMC Executive Senior Vice President, Hyun Soon Lee, has already indicated that the next-generation Tiburon will be rear-wheel drive.

Such a platform would be ideal in underpinning a future premium Hyundai sports sedan, in the way Nissan uses its 350Z undercarriage in several US Infiniti sports/luxury sedans.

However, this will not happen until late this decade.

"We are now focussing on more basic aspects," said HMC’s Director of Marketing Division, Brandon Yea. "Quality is at a good level but other factors are priorities. It (a luxury vehicle) is a tiny issue. We are considering it, but it is not time now."HMC’s perception among customers varies from region to region globally, so consistent global increases in brand awareness is the move behind its recently announced sponsorship of the next three soccer World Cup Championships (2006, 2010 and 2014).

The Kia Question

HYUNDAI Motor Co. is staying mum on the ins and outs of Kia distribution in Australia.

Ateco Automotive, which has held the Kia franchise since early 2000, will relinquish it to HMC from the second quarter of next year.

However, one senior HMC official told GoAuto at the Seoul motor show last month that "it makes sense" for Hyundai and Kia to share back-of-office duties such as shipping, storage, spare parts and servicing.

"And there is plenty of space at Homebush," added Hyundai Australia spokesman Richard Power.

Next year, Kia is likely to undergo a brand transformation in Australia once distribution changes hands.

This will bring it in line with its new global brand management, announced in South Korea in January, which will see HMC promoting the individual characteristics of Kia and Hyundai – a challenge considering that underneath the skin most vehicles are identical.

Nevertheless, Kia will remain more of a "value for money" brand than Hyundai.

HMC acknowledges that the latter’s cost advantage against its Japanese and European rivals will shrink as Hyundai models become more sophisticated, safer, better-equipped and higher-quality products.

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