Posted by: David Kiley on April 7, 2009
Later this year Hyundai will stop selling its Entourage minivan in the U.S. Hyundai CEO John Krafcik says the Entourage was a “cheap lesson in why you don’t do badge engineering.”
The Entourage was really a barely differentiated Kia Sedona minivan. Hyundai and Kia are corporate cousins, and share design, engineering and procurement. And some of their cars and crossovers, indeed, share vehicle architectures. But the minivans, says Krafcik, have been a poor example of what the two companies can do in terms of keeping their brands and product lines separate and distinct.
Dealers had long complained they didn’t have a minivan, so Hyundai caved and rolled out the Entourage in 2007. Last year, Hyundai sold a whopping 8,400 minivans, down 50% from the previous year. Kia sold 27,000, down about 30%.
Of course, it was a tough year for minivans and the industry as a whole. The consensus seems to be that minivans are sliding down to a lower normal rate of sales and that the weaker players are being weeded out. We’ll have to keep watch to see if Kia keeps its van around having lost the sales volume that never materialized from Hyundai. Nissan is on the verge, we think, of mercifully pulling the plug on the Quest.
Chrysler continues to discount the heck out of minivans. People I know have been paying around $24K for a loaded Chrysler Town & Country with every feature box checked. That’s more than $10K off MSRP. That makes it tough for the other players, except for Honda and Toyota, to crack through.
Chrysler, once the king of minivans, has now positioned itself to be the value-brand entry, replacing the Koreans in that role. How did we get here?