Bloomberg News

Hyundai Wins Car of Year for Second Time After Record U.S. Sales

January 10, 2012

(For coverage of the Detroit auto show, see SHOW <GO>.)

Jan. 10 (Bloomberg) -- Hyundai Motor Co., South Korea’s largest automaker, won its second North American Car of the Year award in four years after selling a record number of vehicles in the U.S.

The Elantra compact sedan beat Ford Motor Co.’s Focus and Volkswagen AG’s Passat, the Automotive Press Association announced yesterday at the North American International Auto Show. Hyundai’s Genesis won the award in 2009, the first time a Korean automaker claimed the top honor.

The Elantra, whose U.S. sales surged 41 percent last year, helped Seoul-based Hyundai gain share from Toyota Motor Corp. and Honda Motor Co. in the world’s second-largest automobile market. Japanese carmakers saw production shortfalls in 2011 after natural disasters at home and in Thailand.

“This demonstrates that Hyundai is becoming a fully legitimate competitor in the U.S. market and a major player,” Michelle Krebs, a senior analyst at Edmunds.com and one of the award’s 50 voters, said in an interview. “It’s not only the honors but the sheer sales. And it’s a far cry from where they were.”

Hyundai advanced as much as 2.3 percent in Seoul trading today. The stock climbed 1.6 percent to 225,000 won as of 9:51 a.m., compared with a 1.3 percent gain for South Korea’s benchmark Kospi index.

Quality and styling gains made in the past decade have helped Hyundai increase transaction prices and allowed the company to enter the luxury-vehicle market with its Genesis and Equus sedans.

Standard Equipment

Hyundai models are known for having many features included as standard equipment, said David Champion, senior director of Consumer Reports’ auto-test center. The Elantra tested well for fuel economy, engine performance, interior space, transmission shift quality, handling and trunk space, he said.

“It does well in every single area,” Champion said. “It’s a very well-rounded car.”

John Krafcik, Hyundai’s U.S. sales chief, has yet to announce a sales goal for the year. The company is focused on improving quality and the brand’s reputation, he said in a Jan. 5 telephone interview.

Hyundai’s U.S. sales climbed 20 percent to a record 645,691 vehicles last year. The company’s market share increased to 5.1 percent in 2011 from 3 percent in 2008.

Rising Sales

U.S. sales this year for Hyundai should rise more than 8 percent and exceed 700,000 units, said Dave Cutting, an analyst with forecaster LMC Automotive in Troy, Michigan.

“It will be growing, but leveling off due to increased competition from other manufacturers,” Cutting said. Industry U.S. sales of new light vehicles should rise 7.8 percent to 13.8 million units in 2012, according to LMC.

At the motor show in Detroit, Jaguar Land Rover Plc’s Evoque was named truck of the year. The Evoque won out over Bayerische Motoren Werke AG’s X3 and Honda Motor Co.’s CR-V. Jaguar Land Rover is part of Tata Motors Ltd.

The finalists reflected automakers’ push toward fuel efficiency. Each car gets at least 30 miles per gallon and the truck finalists were sport-utility vehicles, and smaller than past winners in the category, including General Motors Co.’s Chevrolet Silverado and the Honda Ridgeline pickup.

Ford won both awards in 2010 with the Fusion hybrid sedan and Transit Connect commercial van. It was the third time in 17 years one automaker won both awards. Domestic automakers have won the car award 10 times among the 18 times it has been awarded and have received the truck award on 12 occasions.

--With assistance from Alan Ohnsman in Los Angeles and Rose Kim in Seoul. Editors: Bill Koenig, John Lear

To contact the reporter on this story: Mark Clothier in Detroit at mclothier@bloomberg.net

To contact the editor responsible for this story: Jamie Butters at jbutters@bloomberg.net


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