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Hyundai Market Share Likely to Slip

Korean carmaker hitting limits of production capacity.

by on Jul.15, 2013

Hyundai expects to sell around 2,000 of the 2014 Equus luxury sedans in the U.S.

Despite record sales this year, Hyundai expects its market share to shrink in the U.S. because of a continuing – and growing — shortage of vehicle resulting from a lack of production capacity.

“We see more demand for our products than we do production,” Hyundai Motor America Chief Executive Officer John Krafcik said during a visit to the Hyundai-Kia Technical Center to show off the updated version of Hyundai’s luxury car, the Equus. “We can’t get a single incremental unit out of our plants,” he said.

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Nevertheless, Hyundai is still “on track” to increase sales 4.4% this year, to 734,000 vehicles in the U.S., which means from a sales standpoint, “Our year is going well,” Krafcik added.


Production Shortage Dragging Down Hyundai’s Market Share

But incentives fall while transaction prices soar.

by on Mar.15, 2013

The 2013 Hyundai Santa Fe is the latest addition to the maker's line-up.

Hyundai has set sales records in each of the last two months yet could still wind up losing market share this year because of a chronic shortage of vehicles.

The problem is one of global scale and reflects the maker’s cautious approach to boosting production capacity, Hyundai Motor America Chief Executive Officer John Krafcik told But the Korean carmaker is beginning to look for ways to address the situation.

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There is a positive side to the shortage. It has reinforced Hyundai’s effort to transform itself from a “value-based brand to a valuable brand,” according to Krafcik, and in the process, the maker has been able to cut incentives while average transaction prices have jumped to record highs on most of its products.

“We’ve never sold as many cars in January and February as we did in the first two months of this year,” Krafcik noted.


Hyundai Share Could Slip in Face of Vehicle Supply Shortage

Breaking bottlenecks in the search for more product.

by on Jun.22, 2012

Hyundai may be struggling to boost sales but it continues adding new models, including the 2013 Veloster Turbo.

One of the fastest growth spurts in the auto industry could soon come to a screeching halt.

Hyundai’s sales momentum is running into a serious obstacle as the maker slams into severe constraints on production capacity, cautioned U.S. chief executive officer John Krafcik, the maker struggling to free up supplies from Korea and break production bottlenecks at its plant in Alabama.

“This is something you’re going to hear us say over and over again,” he said. “We have about a 32-day supply, which is the lowest industry,” said Krafcik.

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During a preview of three new models, Krafcik notd Hyundai had sold more than 60,000 cars in each of the last three months and is on track to do it again during June. And that despite now having the lowest incentives in the industry.  But sales would have run even higher had dealers had enough inventory, Krafcik warned.

“We’re pretty well tapped out,” he said, warning that the capacity constraints will continue for awhile.


Hyundai Chief Sees Slowdown in Sales Growth

Capacity can’t keep up with demand, so maker shifts goals.

by on Jan.18, 2012

Hyundai Motor America CEO John Krafcik.

It was a good year for Hyundai – perhaps too good.

The Korean carmaker, long known for providing cheap and cheerful econoboxes, scored a solid hit with its must upscale model ever, the premium-Luxury Equus.  It landed its second win with a coveted North American Car of the Year trophy for the compact Hyundai Elantra sedan.  And it saw sales surge to another record.

The numbers would have gone even higher, contends John Krafcik, CEO of Hyundai Motor America, if the maker had enough capacity.  “Even in the worst days after the earthquake and tsunami hit Japan, our inventories have been shorter than either Toyota or Honda,” he said during a conversation with

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The Korean carmaker is actively looking for ways to boost production at its Alabama assembly plant, as well as at a factory run by its sibling Kia providing some additional product for Hyundai dealers.  But barring a sudden slowdown in sales, Krafcik believes Hyundai can’t come near to meeting potential U.S. demand in 2012.


Hyundai Eyes Second U.S. Plant

Maker credited with creating 94,000 U.S. jobs.

by on Nov.14, 2011

The 1 millionth Hyundai Sonata rolls off the assembly line at the maker's Alabama assembly pl.ant.

With dealers selling new models like the Elantra and Sonata as soon as the trucks roll up to Hyundai’s U.S. showrooms, the Korean carmaker is beginning to ponder the need for a second American assembly plant.

John Krafcik, Hyundai Motor America president and chief executive officer, said the South Korean maker’s U.S. dealers could easily sell more vehicles but are hampered by shortages of Hyundai’s most popular products, including the new subcompact Accent, which has been all but sold out since it went on sales this past summer.

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Where dealer inventories typically average 60 days, industry wide, that’s down to barely two weeks, according to Krafcik, a one-time senior Ford engineer, who offered a glimpse at some of the Hyundai products to come during a meeting at the Hyundai-Kia Technical Center near Ann Arbor, Mi.


Hyundai Making Long-Term Gains as Japanese Struggle

But it’s unclear if Koreans are picking up much short-term business during Japanese shortages.

by on Jun.16, 2011

Hyundai products, like the new Elantra, appear well-positioned to pick up sales from struggling Japanese brands.

The shortage of key Japanese products, such as the Toyota Prius and Honda Civic, appears to be having a big impact on the established automotive order.

After years as an also-ran in the compact market, for example, Chevrolet’s new Cruze has been outselling traditional segment leaders Civic and Toyota Corolla.  Meanwhile, Hyundai can barely keep up with demand for its own new compact, the Elantra, which has seen sales more than double over the last year.

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While company officials seem loathe to be seen as taking advantage of the devastating earthquake and tsunami that struck Japan on March 11, crippling that nation’s auto industry, analysts believe that the Korean maker is particularly well-positioned to benefit from the disaster.

“The Koreans are clearly in the best position” to benefit , suggested analyst David Sullivan, of the research and consulting firm AutoPacific, Inc.