Hyundai-Kia raises fleet sales as retail sales slide
04-17-13, 03:28 PM
#1
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Hyundai-Kia raises fleet sales as retail sales slide
http://www.autonews.com/apps/pbcs.dl...il-sales-slide
Grabs popcorn.... well the honeymoon might be over...
Hyundai-Kia raises fleet sales as retail sales slide
To counteract slumping U.S. retail sales, Hyundai-Kia Automotive ratcheted up deliveries of vehicles to fleet buyers in March.
Fleet sales for Hyundai-Kia jumped 33 percent to 17,100 units for the month, partially offsetting a 12 percent drop in retail sales to 100,300 light vehicles.
For the first quarter, the South Korean automaker boosted fleet volume 50 percent to 42,400 units while its retail sales dropped 9 percent compared with the same period last year.
That increased fleet to 15 percent of Hyundai-Kia's total sales mix, up from 9 percent in the first three months of last year.
Hyundai-Kia's actions stand out from those of the six other major automakers in the U.S. market.
As a group, the seven largest automakers raised March sales 3 percent for both retail and fleet. For the first three months, they increased retail volume 7 percent, compared with a 4 percent gain on the fleet side.
Nissan North America cut fleet volume 12 percent in March and 18 percent in the first three months. Its retail sales were 4 percent higher in the first quarter.
In the first quarter of last year, Nissan sent many of its aging Altima and Sentra models to fleet buyers.
But this year with redesigned Altima and Sentra entries, the company said it intends to funnel more of those models to its dealers.
Chrysler Group and Toyota Motor Sales also are less reliant on fleet sales this year. Chrysler's fleet sales have declined 2 percent this year as retail sales have risen 12 percent. Toyota's fleet sales are flat at 73,700 but retail is up 10 percent.
Ford Motor Co. and General Motors have a more balanced approach in the first quarter.
At Ford, retail sales rose 11 percent and fleet 12 percent. GM boosted retail 10 percent but fleet only 6 percent.
American Honda lets dealers handle any fleet sales. The Automotive News Data Center estimates its fleet volume at 2 percent of total sales.
To counteract slumping U.S. retail sales, Hyundai-Kia Automotive ratcheted up deliveries of vehicles to fleet buyers in March.
Fleet sales for Hyundai-Kia jumped 33 percent to 17,100 units for the month, partially offsetting a 12 percent drop in retail sales to 100,300 light vehicles.
For the first quarter, the South Korean automaker boosted fleet volume 50 percent to 42,400 units while its retail sales dropped 9 percent compared with the same period last year.
That increased fleet to 15 percent of Hyundai-Kia's total sales mix, up from 9 percent in the first three months of last year.
Hyundai-Kia's actions stand out from those of the six other major automakers in the U.S. market.
As a group, the seven largest automakers raised March sales 3 percent for both retail and fleet. For the first three months, they increased retail volume 7 percent, compared with a 4 percent gain on the fleet side.
Nissan North America cut fleet volume 12 percent in March and 18 percent in the first three months. Its retail sales were 4 percent higher in the first quarter.
In the first quarter of last year, Nissan sent many of its aging Altima and Sentra models to fleet buyers.
But this year with redesigned Altima and Sentra entries, the company said it intends to funnel more of those models to its dealers.
Chrysler Group and Toyota Motor Sales also are less reliant on fleet sales this year. Chrysler's fleet sales have declined 2 percent this year as retail sales have risen 12 percent. Toyota's fleet sales are flat at 73,700 but retail is up 10 percent.
Ford Motor Co. and General Motors have a more balanced approach in the first quarter.
At Ford, retail sales rose 11 percent and fleet 12 percent. GM boosted retail 10 percent but fleet only 6 percent.
American Honda lets dealers handle any fleet sales. The Automotive News Data Center estimates its fleet volume at 2 percent of total sales.
04-17-13, 09:10 PM
#3
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competition is stronger than ever out there ... sonata is now aging and other models too, and prices have slowly (and not so slowly) gone up. fuel economy claims were exaggerated. new accord, altima, mazda 6, fusion, malibu, and of course camry all eat huge chunks of the middle of the road sedan market. hyundai/kia's doing better in cuv/suvs and has niches like veloster/soul but they need to bring some new sedan models out.
04-17-13, 10:36 PM
#4
Lexus Test Driver
Pretty much what Bit said. They had a few years of several new, core products. Now there's been less introductions and the competitors have introduced their big ones. It makes sense the sales trophy transfers around to the company putting out a lot of fresh products.
04-17-13, 11:38 PM
#5
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Of course their sales are dropping and they are struggling, this is all happening right on cue.
What interesting products? Not much, as both Hyundai and Kia lineups are mostly new and redesigned. So this is going to be a long several years for Hyundai/Kia as the competition continues to release redesigns of aging models.
This is occurring exactly as predicted. The new products from the competition are much more compelling than the overhyped fluff products that Hyundai/Kia have been pandering.
The Sonata has been out in the US market for 3 years, so in objective terms it's not that old.
However in terms of styling, the Sonata is not just "aging", but it has aged horribly, and aged very quickly. Many predicted this would happen when the Sonata was first unveiled. Such goofy and exaggerated styling always ages poorly with time. In a year or two the current Sonata will look even more goofy and out of place.
Well you mentioned the biggest reason why Hyundai/Kia are struggling; fluff and exaggerated, overhyped claims. Their new models were improvements in some ways over previous models, but they were never overly competitive to begin with. They only temporarily appeared that way due to desperate overhyping, and due to outdated competing models.
Now that Hyundai/Kia's redesigned lineups are competing with redesigned competitor's lineups, their products don't look great to consumers at all. Market share and retail sales have been consistently falling since last year. The numbers don't lie.
Yet many other competitors were impressively able to maintain and keep steady their sales levels even with old, aging models.
The fact is, Hyundai/Kia lucked out because they rushed out their redesigned lineups to get a temporary advantage over the competition, and they overhyped their lineup hard. Roughly at the same time the biblical disaster happened in Japan which was pure luck for Hyundai, and temporarily had a significant effect on the supply of Japanese automakers.
Now Hyundai has been embarrassed with grossly overstating EPA numbers, is under suspicion for over-reporting and overstating HP numbers, and their models are nothing special compared to the redesigned competition.
The auto industry is not a game of hot potato. Just because a competitor has a redesigned model does not automatically mean it will get the "sales trophy" from other competing models. If you have a very competitive product, dated or not it will maintain strong sales. Products like the Camry, Corolla, F-Series, Accord, etc. all impressively maintain solid sales and market share even when they become dated.
It doesn't work like that. Again, Hyundai's temporary success was due to an extraordinary set of circumstances over the last several years, combined with desperation on their end, and some luck. Now, karma and the consequences of their desperation is coming back to bite them hard.
Most of the Hyundai and Kia lineups were redesigned within the last 2 years. That definitely doesn't make their lineups full of dated models. It makes their lineups still relatively fresh, and what it does mean is tough luck for Hyundai/Kia because they have to make due with these models over the next several years until the next redesign cycle hits. In a few years though, consumers may not be so willing to give Hyundai/Kia a try. Consumer confidence has been burned quite badly with the EPA fiasco and their desperate marketing/overhyping, so it may be a long time before many consumers give Hyundai/Kia another chance.
This is occurring exactly as predicted. The new products from the competition are much more compelling than the overhyped fluff products that Hyundai/Kia have been pandering.
competition is stronger than ever out there ... sonata is now aging and other models too, and prices have slowly (and not so slowly) gone up. fuel economy claims were exaggerated. new accord, altima, mazda 6, fusion, malibu, and of course camry all eat huge chunks of the middle of the road sedan market. hyundai/kia's doing better in cuv/suvs and has niches like veloster/soul but they need to bring some new sedan models out.
However in terms of styling, the Sonata is not just "aging", but it has aged horribly, and aged very quickly. Many predicted this would happen when the Sonata was first unveiled. Such goofy and exaggerated styling always ages poorly with time. In a year or two the current Sonata will look even more goofy and out of place.
Well you mentioned the biggest reason why Hyundai/Kia are struggling; fluff and exaggerated, overhyped claims. Their new models were improvements in some ways over previous models, but they were never overly competitive to begin with. They only temporarily appeared that way due to desperate overhyping, and due to outdated competing models.
Now that Hyundai/Kia's redesigned lineups are competing with redesigned competitor's lineups, their products don't look great to consumers at all. Market share and retail sales have been consistently falling since last year. The numbers don't lie.
The fact is, Hyundai/Kia lucked out because they rushed out their redesigned lineups to get a temporary advantage over the competition, and they overhyped their lineup hard. Roughly at the same time the biblical disaster happened in Japan which was pure luck for Hyundai, and temporarily had a significant effect on the supply of Japanese automakers.
Now Hyundai has been embarrassed with grossly overstating EPA numbers, is under suspicion for over-reporting and overstating HP numbers, and their models are nothing special compared to the redesigned competition.
The auto industry is not a game of hot potato. Just because a competitor has a redesigned model does not automatically mean it will get the "sales trophy" from other competing models. If you have a very competitive product, dated or not it will maintain strong sales. Products like the Camry, Corolla, F-Series, Accord, etc. all impressively maintain solid sales and market share even when they become dated.
It doesn't work like that. Again, Hyundai's temporary success was due to an extraordinary set of circumstances over the last several years, combined with desperation on their end, and some luck. Now, karma and the consequences of their desperation is coming back to bite them hard.
Most of the Hyundai and Kia lineups were redesigned within the last 2 years. That definitely doesn't make their lineups full of dated models. It makes their lineups still relatively fresh, and what it does mean is tough luck for Hyundai/Kia because they have to make due with these models over the next several years until the next redesign cycle hits. In a few years though, consumers may not be so willing to give Hyundai/Kia a try. Consumer confidence has been burned quite badly with the EPA fiasco and their desperate marketing/overhyping, so it may be a long time before many consumers give Hyundai/Kia another chance.
04-18-13, 12:08 AM
#6
Lexus Test Driver
I know third-party buyers are giving out KILLER lease deals on Hyundai cars right now.
Friend of the father leased a Sonata for $190/mo (fees and all) and put nothing down.
Friend of the father leased a Sonata for $190/mo (fees and all) and put nothing down.
04-18-13, 01:09 AM
#7
What interesting products? Not much, as both Hyundai and Kia lineups are mostly new and redesigned. So this is going to be a long several years for Hyundai/Kia as the competition continues to release redesigns of aging models.
This is occurring exactly as predicted. The new products from the competition are much more compelling than the overhyped fluff products that Hyundai/Kia have been pandering.
This is occurring exactly as predicted. The new products from the competition are much more compelling than the overhyped fluff products that Hyundai/Kia have been pandering.
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04-18-13, 02:18 AM
#8
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The next generation of Hyundai productst. 2015 Genesis is nearing. Hyundai is beginning to take a page out of Toyota's/Lexus book. The second generation will fix the faults of the first and slowly chase a more premium title on the higher end. I will give them credit they offer something competitive and consistently updated but they are far from perfect.
04-18-13, 03:01 AM
#9
The next generation of Hyundai productst. 2015 Genesis is nearing. Hyundai is beginning to take a page out of Toyota's/Lexus book. The second generation will fix the faults of the first and slowly chase a more premium title on the higher end. I will give them credit they offer something competitive and consistently updated but they are far from perfect.
04-18-13, 09:08 AM
#12
Well Kia is there to keep things mainstream if Hyundai decides to chase a more upscale image. In 10 years time I expect them to be much more luxurious than they are now, while the Chinese come to this market and do what Hyundai did and offer vehicles at price points below that of established competition - of course they will be crude just like Hyundai started.
04-18-13, 09:30 AM
#13
Lexus Champion
Well Kia is there to keep things mainstream if Hyundai decides to chase a more upscale image. In 10 years time I expect them to be much more luxurious than they are now, while the Chinese come to this market and do what Hyundai did and offer vehicles at price points below that of established competition - of course they will be crude just like Hyundai started.
You are too young to remember the very cheap (price- and quality-wise) cars that came from Toyota and Datsun (Nissan) 40+ years ago. The Hyundai Pony and first Elantra that came 20+ years ago now reminded us of those first Japanese cars.
We used to complain that those early-1970s Datsuns were made out of recycled tin cans. We also complained that those early Datsuns were copies of established cars. Well, the Japanese (and later the Koreans, and soon the Chinese) copied their way to superiority.
04-18-13, 09:36 AM
#14
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-trucks
-SUVs
-V-8s in trucks
-Vans
-Cargo Vans
etc etc.
Smaller and basically car only brands look good with "oh we don't sell fleet" b/c fleets don't want them.
Anyone that has rented a car has seen anything from Infiniti to Kia, all brands are represented seemingly, heck Porsche, Lamborghini etc.
For people that don't understand the auto business, the whole "fleet sucks" is just that, a comment for those that don't understand the business.
04-18-13, 10:10 AM
#15
The Chinese will repeat what the Koreans 20 years ago, just as the Koreans repeated what the Japanese did 40 years ago now.
You are too young to remember the very cheap (price- and quality-wise) cars that came from Toyota and Datsun (Nissan) 40+ years ago. The Hyundai Pony and first Elantra that came 20+ years ago now reminded us of those first Japanese cars.
We used to complain that those early-1970s Datsuns were made out of recycled tin cans. We also complained that those early Datsuns were copies of established cars. Well, the Japanese (and later the Koreans, and soon the Chinese) copied their way to superiority.
You are too young to remember the very cheap (price- and quality-wise) cars that came from Toyota and Datsun (Nissan) 40+ years ago. The Hyundai Pony and first Elantra that came 20+ years ago now reminded us of those first Japanese cars.
We used to complain that those early-1970s Datsuns were made out of recycled tin cans. We also complained that those early Datsuns were copies of established cars. Well, the Japanese (and later the Koreans, and soon the Chinese) copied their way to superiority.
