Some analysts feel the global economy has entered a period of recovery; that combined with new models and technology means success for automaker Hyundai Motor Company and its affiliate, Kia Motors Corporation.
The two are South Korea’s biggest car makers, and they have set a goal to increase sales this year by 17% or 5.4 million vehicles in combined worldwide sales. In 2009, they sold around 4.63 million units. The goal was announced in a New Year’s speech made by Chairman Chung Mong Koo.
As new models are added like the new Sonata sedan, and as consumer demand increases, growth in the auto sector will respond favorably says Sohn Myung Woo, analyst at Woori Investment & Securities Company in Seoul. Nissan and Toyota, Japanese rivals of Hyundai, also have predicted sizeable sales amid the economic recovery from what some call the worst recession since the great depression.
Sohn says, I don’t see any major risk or challenge for Hyundai this year. Strong products, favorable currency trends and aggressive marketing efforts should spur sales and earnings in 2010. Market share will also continue to grow.
Toyota increased their 2009 goal to 7.03 million vehicles from 6.6 million. Nissan also raised its sales forecast for the fiscal year (ending in March) from 3.08 million to 3.3 million units.
Market share for Hyundai and Kia rose to 7.6 % due to growing demand for smaller cars with greater fuel efficiency and the weaker won, which allowed them to put more money into marketing, says Sohn.
Hyundai sold 3.1 million vehicles, which is a record number and exceeds the 2008 total for the company by 12%. Kia sales went up 9.6% to 1.53 million, the company reports.
Chung told reporters, We turned a crisis into an opportunity last year. We’ll leap into the position of a leading global automaker this year amid tougher competition.
U.S. sales for Hyundai increased 6.2%, and Kia’s increased 7.8%. The first Kia factory in the U.S. opened last year in Georgia. Hyundai will be building a new factory with a 300,000 unit annual capacity in China.
The need for new vehicles, improving credit availability and overall economic recovery may cause a rise in U.S. sales equaling 19% to 12.4 million, says Sean McAlinden, chief economist at the Center for Automotive Research in Ann Arbor, Michigan.
The Hyundai Assurance marketing program in the U.S. will be extended until the end of 2010; this program allows for the return of vehicles by buyers who lose their jobs.
The new Sonata from Hyundai will hit the U.S. market this month, and at least three revamped models will be introduced domestically. Kia will be offering a new Lotze midsize sedan and a compact SUV.