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Hyundai makes its move

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Hyundai makes its move

Company now 3rd in midsize market

Christine Tierney / The Detroit News

Automakers have struggled for years to dislodge the Toyota Camry and Honda Accord from the top ranks of the big and lucrative midsize car segment.

Ford Motor Co. redesigned its Fusion, and General Motors Co. produced a vastly improved Chevrolet Malibu.

But it turns out to be Hyundai Motor Co. that's fielding the most aggressive assault on the dominant Japanese nameplates with its new Sonata.

Introduced in February, the Sonata is pulling ahead of the other challengers. In August, it outsold the Nissan Altima, the Malibu and the Fusion.

Sonata sales totaled 21,399, nearly double the prior-year sales of the previous Sonata, while the Fusion, Altima, Malibu and the larger Chevrolet Impala each generated fewer than 19,000 sales in August, according to Autodata Corp.

Honda Motor Co. sold 22,506 Accords, and Toyota Motor Corp. sold more than 30,000 Camrys. Together, the Camry and Accord account for about a third of the 2 million midsize cars sold annually.

On a retail basis, or excluding sales to rental car companies and other fleet buyers, the Sonata has outsold the Fusion and Malibu for the past six months, said John Krafcik, CEO of Hyundai Motor America in Fountain Valley, Calif.

"We haven't been able to catch the Accord and Camry, but we've done very well," Krafcik said.

According to auto research firm Edmunds.com, the proportion of prospective midsize car buyers who are considering a Sonata has jumped to 19.5 percent from 6.2 percent in January 2007.

Some buyers cite the new Sonata's looks, while others describe it as a good deal.

"One of the big reasons I went for the Sonata was the warranty" of 10 years or 100,000 miles, said Rick Schmidt, 55, a semi-retired former government worker in San Diego.

He also looked at the top-end Fusion and was nearly won over by the Sync communication and entertainment system, but he preferred the Sonata's interior.

"I'm a bit of a tall guy and it's roomier than the Fusion," Schmidt said. In May, he bought a Sonata Limited, the top trim level, which starts at $25,295.

The base Sonata GLS model starts at $19,195, and the sporty SE starts at $22,595. According to Edmunds, the Sonatas are priced below comparably equipped Camry and Accord models.

Like Schmidt, who drove a Cadillac Seville for seven years, about three-fourths of Sonata buyers are "conquests" trading in other brands, Hyundai says.

By luring customers from other carmakers, Hyundai keeps expanding its share of the U.S. market, to 4.7 percent this year from 3 percent in 2008. Including sales of its Kia Motors affiliate, the Hyundai-Kia Automotive Group's U.S. market share rose to 7.8 percent in that time from 5.1 percent.

While Hyundai is pressing up against the leading Japanese automakers in the U.S. market, "one of the bigger threats to Hyundai will come from Kia," said Jeremy Anwyl, CEO of Edmunds.

Kia's new midsize Optima, which shares underpinnings with the Sonata, looks competitive, too, he said.

"They're quick learners," said Jack Nerad, an analyst at Kelley Blue Book, the car-pricing firm.

Nerad, who has recommended the Sonata to car shoppers, called the Sonata "one of the best-looking vehicles in the midsize segment and the most modern."

Hyundai is preparing for its next launches, including an all-new Elantra early next year and a full-size luxury sedan, the Equus, in a segment where Hyundai hasn't previously competed in the United States.

The carmaker has strived for years to prove that it's as good at making cars as the top brands, but it's now increasingly pursuing its own line, Krafcik said.

Hyundai's decision to offer a four-cylinder engine only for the Sonata, albeit with turbo-charged and hybrid versions to follow, reflects that confidence.

With most rivals offering four- and six-cylinder engines, it seemed a risky move at the time. But it allowed Hyundai to reduce the Sonata’s weight, achieving good mileage — 22 or more miles per gallon in the city, 35 on the highway — and a better power-to-weight ratio than most rivals.

Some midsize cars offering both four- and six-cylinder engines may feel sluggish to customers who are increasingly opting for the smaller engines.

Hyundai’s decision "reflects the new philosophy," Krafcik said, "not to look at competitors but to set our own trajectory."

From The Detroit News: http://www.detnews.com/article/20100921/AUTO01/9210315/1148/Hyundai-makes-its-move#ixzz10Aa60jvH

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Report: Hyundai Sonata overtakes Nissan Altima for third in mid-size segment

by Zach Bowman (RSS feed) on Sep 21st 2010 at 2:27PM

Hyundai is movin' on up. According to The Detroit News, the Sonata officially displaced the Nissan Altima as the third best-selling mid-size sedan in America last month. In August, the Korean manufacturer sold 21,399 units, falling just behind the Honda Accord at 22,506 and the Toyota Camry at a little over 30,000. Those numbers are just based on retail sales, not the vehicles that are sold off to rental fleets. The Sonata has been besting rivals like the Ford Fusion and Chevrolet Malibu for a good while now, but this is the first time the car has managed to rattle the Japanese triumvirate that dominates the segment.

It seemed to be only a matter of time, though. The Sonata now wears some of the best looking sheet metal of any midsizer out there and its price tag comes in a good bit lower than both the Accord and the Camry. Throw in a snappy interior and very efficient drivetrain options, and suddenly you've got the attention of the car-buying public. The Detroit News says that since the 2011 Sonata debuted, the number of car buyers considering the vehicle has leapfrogged from 6.2 percent in January of 2007 to 19.5 percent recently. Thanks for the tip, Nicolai!



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