Despite an expected slump in the U.S. car market this year, Hyundai is still setting its goal for 2008 at a rather lofty 500,000 units. Last year, the Korean automaker set an initial goal of 550,000 U.S. sales, but adjusted that to 512,000 sales during the year. However, Hyundai fell well short of its 2007 goal, moving only 467,009 vehicles.
“We’ve been knocking at the door for 500,000 units for three years,” Dave Zuchowski, vice president of sales for Hyundai Motor America, told Automotive News. “We think we can do it this year. Our rallying cry is 500,000 units, regardless of what the industry is doing.”
Hyundai is hoping to increase its global sales by 20% in 2008, but will rely heavily on emerging markets for the new growth. Unlike the past several years, executives in Korean have lowered their unrealistic goals for the U.S. market. “We spent a lot of time explaining the market situation to the Koreans,” Zuchowski says. “I think they realize we can’t get as much sales growth as the emerging markets.”
To improve its U.S. sales, Hyundai is now turning its focus to its dealership network. According to Zuchowski, Hyundai’s dealer profits were already under the industry average, and declined another 5% in 2007. Much of the declined is blamed on the fact that Hyundai dealerships don’t rely as heavily on used cars as other franchise, but several new initiatives have been put in place to help profitability on new cars for 2008.
Some of the new programs for this year include more advertising, rewards for dealerships based on customer satisfaction and greater dealer incentives.
However, despite the plans, some Hyundai dealers feel that the automaker is over-hyping its upcoming Genesis sedan and coupe. “The Genesis sedan and coupe are great-looking cars, but higher prices usually mean less volume,” Gary Micallef, chairman of the Hyundai Dealer Council, says. “With the rising prices of fuel, we need to focus on our entry-level vehicles.”
