Sports utility vehicles (SUVs) accounted for more than 70 percent of Hyundai Motor Group’s cars sold in the United States. They have higher margins per unit than sedans, so Hyundai Motor Group’s profitability is also expected to grow significantly.
Hyundai Motor Company (including the Genesis brand) sold 117,158 cars and Kia Corp. 112,842 cars in the United States between January and February of 2023, Hyundai Motor Group said on March 6. Compared to the previous year, the two companies’ sales increased by 9.1 percent and 23.1 percent, respectively. Of total sales, 162,632 units were SUVs, which accounted for 70.7 percent of the total. The percentage is the highest share ever. In 2015 alone, SUVs accounted for only 36.0 percent of cars sold by Hyundai Motor Group in the U.S. market. The proportion has nearly doubled in eight years.
Jose Muñoz, global chief operating officer (COO) of Hyundai Motor Group, picked the SUV as one of the three strategic models to penetrate the U.S. car market in January of last year. The remaining two were electric cars and luxury cars. Since then, the SUV lineup has been expanded in various ways in the U.S. market. In 2015, Hyundai Motor Group was selling only five types of SUVs – Hyundai Motor’s Tucson and Santa Fe, and Kia’s Sportage, Soul, and Sorento. But the Korean automotive group is selling 18 SUV models from small to large. Its luxury brand Genesis also launched its own SUVs the GV60, the GV70, and the GV80. Hyundai Motor Group is also expanding sales in the eco-friendly vehicle market with SUVs such as the hydrogen car Nexo and the electric cars IONIQ 5 and EV6.
As its vehicle lineups are reorganized around SUVs, Hyundai Motor Group’s profitability is expected to jump. “Hyundai Motor Group exceeded one million units in sales in the United States last year,” an industry insider said. “However, from a profitability perspective, what is more encouraging than its sales volume is its shift to SUVs.”
Meanwhile, Hyundai Motor Group’s January sales ascended by 24.3 percent to 78,740 units compared to the same period of 2022, according to the Society of Indian Automobile Manufacturers (SIAM).
Both Hyundai Motor and Kia Corp. were in the top five carmaker standings in the Indian car market. The market share was 14.4 percent for Hyundai Motor and 8.2 percent for Kia Corp., recording a combined 22.6 percent, up 1.5 percentage points from the same period of 2022. By brand, Hyundai Motor Company ranked second and Kia ranked fifth. Maruti, which ranked first in the Indian car market, is a joint venture between Suzuki of Japan and Maruti of India, followed by local companies Tata (3rd) and M&M (4th).
Hyundai Motor’s flagship model in the Indian market is the Creta, a small sports utility vehicle (SUV). The model was launched in India in 2015 and has been in production in Indonesia since 2021. In January, 15,037 units of the Creta were sold, a 52.4 percent increase compared to the same period last year. Creta placed 6th in the sales rankings by models in the Indian market.
In addition, the Kia Carens minivan, which was recently selected as India’s Car of the Year, sold 7,900 units, a 14-fold increase from the same period last year.
It is no exaggeration to say that India holds the key to Hyundai Motor Group’s expansion of its overseas markets. In 2022, overseas sales of Hyundai Motor and Kia Corp. hit 5,614,822 units, up 3.8 percent from the previous year. During the same period, their sales shrank by 2.5 percent to 1,229,952 units in Korea.
