Is Hyundai poised to beat Toyota?

If you look at the sales numbers, Hyundai is like eating everyone else's lunch (with the exception of Subaru, which has seen consistently flat to slightly positive growth).

 

Hyundai has three extremely huge hurdles to overcome which will likely keep it in a distant 6th place at best ( 7th place now ).

1. It doesn't have anywhere near the retail coverage of any of the top 6 makers. Without stores it cannot sell vehicles, it really is that simple.
2. It doesn't have the product depth needed to advance much farther beyond Chrysler.
3. It doesn't have the production capacity to advance much beyond 6th place.

US sales ranks...
GM ( Chevy, GMC, Buick, Cadillac )
Toyota/Lexus
Ford/Lincoln/Mercury
Honda/Acura
Chrysler
Nissan/Infiniti
Hyundai

Hyundai's 'big' increases percentage-wise are the result of fleet sales in the early part of the year on top of very small numbers from last year. Look at actual unit sales...

A 1000 unit increase on a 10,000 unit base is a 10% increase.
A 1000 unit increase on a 25,000 unit base is a 4% increase.

Hyundai/Kia is a serious competitor with several good new products coming to market soon. Imagine though how upset the owners in Korea must be to be bringing all these wonderful new products to market here and seeing Toyota and Honda selling 'inferior' products at $2000 to $3000 more per unit. Hyundai's still sell mainly on price.

 

They're still eating everyone's lunch: I didn't say it.
Hyundai Continues To Shine - The Atlantic Business Channel

Automakers Announce New Incentives, but Only Hyundai's Plan is Working - U.S. News Rankings and Reviews

Ford, Hyundai could be big winners from Toyota's woes. - Feb. 1, 2010

Hyundai Profits Increase Substantially; Growing Demand in a Down Market.

 

My analyses still stand as accurate. The hurdles that Hyundai has to overcome are overlooked by all the superficial wisdom spewers. Look at the actual numbers.

Hyundai is in 7th place and a very very distant 7th place. In addition just to maintain it's position it has taken over the mantle of 'fleet queen' from the detroiters. Then to top that all off it sells it's vehicles $1000 to $3000 lower than Toyota and Honda.

It has no hybrids, it has no trucks, it has no BOF SUVs, it has a very limited product offering in 4-1/2 segments...
compact car
midsized car
compact crossover
midsized crossover
minivan
....mainly the top four. It's growth til now has been at the expense of Chrysler and GM due mainly to the backlash from the bankruptcies. It may win some 'grazing' buyers from Toyota this year but it's three huge hurdles cannot be ignored.

It's a serious competitor with good products but the reality is that it's the 7th place competitor. I see the reality every day. Our Hyundai store is across the street. It's the biggest in our market but it's still a small store with significant retail volume issues.

 

I'm not any kind of super-smart analyst so I'll just post numbers as of Feb 2, 2010.

Auto Sales - Markets Data Center - WSJ.com

I hope you all enjoy and draw your own conclusions.

 

Point-by-Point in your referenced articles....

1. This was a one-month report on Nov 2009 sales. One will go blind looking at single trees in a forest. One has to look, at minimum at the whole year's sales.

2. This was from a year ago. It's old, musty and crusty information.

3 The title says it all...".....could be .......". This isn't data analysis. It's one writers personal opinion based on zero facts, simply supposition concerning the certain shrinkage of Toyota sales in early Feb and who might benefit.

4. Good quarter for Hyundai with $819 million in profits..however the big boy on the block..
From Toyota's 3rd Qtr announcement last week:

At an exchange rate of 90 JY : US$ that means that Toyota in the 3rd Qtr earned $2.1 Billion ( 189.1 / 90 ).

Perspective.

 

Well this is part of my job, keeping track of everybody and everyone in the auto market and seeing who's doing what to whom.

What these figures don't tell you, which I can show you if you request, is that in the key competitive market segment of midsized autos Hyundai and Ford ate up Chrysler, Honda and Nissan ( all big losers ). Chevy gained a little from Toyota.

However all Hyundai's gains were in fleet sales which the detroiters walked away from. Ford was the real big winner on a retail basis. It gave up lower-priced fleet sales and gained significantly higher-priced retail sales. Honda and Nissan seemed to lose sales to Ford while Chrysler and GM gave up fleet sales to Hyundai and Chevy gained some retail sales from Toyota.

That very first chart in the WSJ page tells it all. Of the top 20 best selling vehicles in Jan 10...there were ZERO Hyundai's. NONE. If some company was selling one vehicle per month before and now is selling two vehicles per month that 100% gain in sales looks good but in fact means nothing.

 

Good point. Let's take a look.
Toyota vs Hyundai, model for model in sales volume Jan 2010
Tacoma vs..... nothing
Tundra vs...... nothing
Sequoia vs..... nothing
4Runner/FJ vs. nothing
Lexus vs........ nothing
Scion vs........ nothing
Sienna vs....... nothing
Avalon vs Genesis..... 944 vs 1700
RAV4 vs Tucson...... 7900 vs 2200
Camry vs Sonata... 15800 vs 5300
Corolla vs Elantra... 17100 vs 7700
Yaris vs Accent....... 3700 vs 5700
Highlander/Venza vs Santa Fe/Vera Cruz... 8100 vs 7600

and of course... Prius vs NOTHING
Of course all the numbers from Toyota are based on 3 weeks sales in January not 4+ weeks for Hyundai.

The Sonata will be a strong competitor, as long as people see a significant price difference between it and the Camry/Accord. Nobody in their right mind pays the same price for a Sonata as they do for the CamCords. It will be a good vehicle in 7th place!!

It will be a good vehicle in - 7th place.

Ooooo, Wow, huge percentage jump. Tiny volume jump.

Also most of Hyundai's end up in fleet lots replacing the Chryslers and Pontiacs and Chevy's and Taurus'. These are not sales to write home to Mom about. They're giveaways to cover the fixed costs at the plant in order to keep it running full steam.

As good as the new Sonata is, it's going to be a star in the third movie on a Friday night Drive-In Theater. And is Hyundai poised to beat Toyota? Rubbish. It's in a struggle to go from 7th place to 6th place and beat Chrysler as Chrysler shrinks off the face of the earth. If Chrysler rebounds then Hyundai stays in 7th place. Then it has to watch out for VW/Audi kicking it down to 8th place.

It's tough to be the shrimp on the block.

 

The scary thing is all those subdivision size pick-ups that continue to be sold every month. In my unscientific estimate, it would take about 85 Prius to produce the same amount of emissions as one of these monsters. OK, maybe 84.

 

many still don't see Apple as a threat to anything...

 

Where is the Hyundai counterpart to the Prius? If there is one I will check it out.

 

Doesn't Toyota own Hyundai??
So, who cares?

 

Selling vehicles to rental segment is a doube-edged saw.
Honda has been trying to avoid doing that.
Low profit, low-end vehicles (gives the automaker a bad reputation).
Toyota does that much more than Honda, if you check the data.
If you compare only private owner sale, Accord often comes out on top of Camry.
So does Civic vs Corolla.

Hyundai?
From what I see, several factors preventing it from long-term growth:
-dealerships: scarce and poor
-reliability: some are great, some are still bad - need to be consistent
-styling: Nothing that I like so far - strange shapes and body lines
-cost: take away the extremely great warranty, see if they still sell as well?
-resale: have you tried to trade-in a Hyundai lately?

Anyway, I wish the Korean automakers do well. BTW, Hyundai owns Kia.
They do sell on low cost of manufacturing. Warranty is part of the cost equation.

 

The Sonata and the Prius have nothing in common except that they're cars. Comparing them is asking if you like apples or oranges. Well the answer is yes, I like both. But they're so different that there's no rational comparo that can be made except that they appeal to different segments of the buying public.

Trying to compare the Prius and the Sonata is pounding a square peg into a round hole.

1. The Prius is a 5 door hatchback that can carry things that will never ever fit into a Sonata...huge advantage for the Prius.
2. The Sonata is a 4 door sedan with more passenger room inside...huge advantage for the Sonata.
3. The Prius is a technological marvel appealing to the inner techie that the Sonata simply cannot appeal to....huge advantage to the Prius.
4. The Sonata has a longer wider wheelbase which gives is a smoother ride...huge advantage to the Sonata.
5. The Prius has the best fuel economy in the world for a vehicle in the midsized/compact class....huge advantage to the Prius.
6. The Sonata, initially, can be purchased less expensively...advantage to the Sonata.
7. The Prius has a far better resale and residual values and upon resale it recovers much of that price difference just above....huge advantage that negates No 6.

Wrong place here to try to hump the Sonata. We've been over and over and over and over all these points over the last 8 yrs with every newb that arrives with the next best reason why 'Xxxxxx' is a better option than the Prius. All fail..the Prius grows ever bigger.

It comes down to ... '..to each their own...' Have fun selling your lovely new Sonata's.