Stepped-up Marketing Next Year

Hyundai, Kia boost sales target to 5.4 mln units next year, a 16 pct YoY increase, counting on a resurgent global car market

"Unstable factors will still remain in the car markets around the world even next year, and therefore, we should not relax and we should keep the marketing activities up to boost the brand image of our cars, while strengthening after service,” said Chairman Chung Mong-koo of the Hyundai-Kia Automotive Group at the group’s strategy meeting for heads of regional marketing both at home and overseas held at the group’s head office in Yangjae-dong, southern Seoul on Dec. 14.
About 20 heads of regional headquarters and overseas units reported their achievements this year and discussed the marketing outlook for next year and marketing strategies for each region at the meeting.
High officials of the group said most of the strategic objectives for this year have been met and next year’s marketing strategies will be even more aggressive.
The attendees at the meeting agreed that the world economy is expected to recover, but a number of problems are expected to surface including high raw materials prices, the end of subsidies for buying new cars, and the appreciation of the Korean won, among others.
The group set its global car sales target at 5.4 million units, up 750,000, or 16 percent YoY ― much higher than the projected global increase in car sales estimated at 6 percent. The estimated global sales of cars by the group are likely to reach 4.65 million units this year. The auto group means to keep up with its aggressive sales strategies next year to achieve the ambitious target.
The production capacities at both Hyundai Motor’s and its sister Kia Motors’ plants stand at between 5.5 million units to 5.8 million units per year and the sales target for next year is very close to the production capacities. By 2012, the group’s total annual car production capacities would expand to 6.76 million units with the additional car plants in China, Brazil and Russia going on stream by then.
The group expects Kia Motors’ plant in Georgia, the United States, will go on stream next year. Hyundai Motor’s Czech plant is expected to increase its output capacity to 300,000 units from the current 200,000 units by 2011. Hyundai Motor’s Russian plant, with output capacity of 100,000 units per year, will go on stream in 2011. In 2012, the group is counting on the car plant in Brazil with an annual capacity of 100,000 units and the third auto plant in Beijing being built by Hyundai Motor to go online.
At the strategy meeting, they agreed that car markets in India and China would continue to rapidly expand next year and they boosted their sales targets for those countries for 2010. The sales target for China has been expanded to 1 million units, the first time an overseas marketing subsidiary set its goal that high.
The sales target in the United States has also been boosted with the Georgia plant, capable of producing 300,000 cars per year, going on stream next year and the U.S. car market on the verge of recovering.
The meeting also resulted in agreement that the European car market would not be as upbeat, as most of the government subsidies in EU countries on the exchange of old cars with new ones would end next year.
They also decided to maintain the group’s 80 percent market share at home by introducing new sedan models including the Avante, Grandeur, Verna and others for Hyundai Motor, and the Sportage, Lotze, Soul, K-7, Morning and others for Kia Motors next year.
In the meantime, Hyundai Motor’s Tau gasoline engine won the Korea Grand Technology Award, the top award, for its high per mile fuel efficiency ratio from the Ministry of Knowledge Economy.
“We will make sedans that will require no maintenance work for 10 years due to their high quality so that they will be the best brands to buy,” declared Vice Chairman Shin Jong-woon of the Hyundai-Kia Automotive Group in a speech at the 2009 Quality Strategy Conference held at the group’s Namyang Research Institute Dec. 11-12.
Shin said both Hyundai and Kia should prepare for its management 10 years from now and the new challenges ahead. He said he will strive to change the brand image for the group’s cars, adding that the confidence won this year in overcoming the economic recession would be a new source of strength for the group in the days ahead. nw

The new model of the Avante and car engines developed by Hyundai Motor including the Tau engine and a fuel battery engine to power its hybrid cars.