Poor Sales in China
Hyundai Motor and its smaller affiliate Kia Motors, which aims to sell over 8 million cars in the global market for the third consecutive year, have been hit by the China shock since the beginning of the year once again.
According to the data from industry sources on Feb. 28, the two South Korean carmakers sold a combined 124,495 cars in the Chinese market, down 21.9 percent from 159,449 units a year earlier.
Hyundai Motor's sales in China plummeted 27.2 percent on-year to 75,236 units during the same period, while Kia Motors saw its sales shrink 12.2 percent to 49,259 units.
Their decline is the sharpest in Jan. among 8 major automakers in China.
Other players enjoyed sales growth during the same period. Toyota’s sales jumped 55.2 percent, Honda’s 44.2 percent, GM 30.8 percent, Ford’s 16.2 percent and Nissan’s 2.8 percent. Chinese automakers also posted a combined 26.3 percent rise in sales compared to a year ago.
In addition to Hyundai and Kia Motors, Volkswagen and Peugeot Citroën Automobiles also suffered from sales contraction in China. Volkswagen’s January sales slid 1.6 percent while Peugeot Citroën Automobiles’ retreated 10.6 percent. Although the demand for automobiles in China expanded 12.3 percent to 1.81 million units in January from a year ago, Hyundai-Kia Motors showed weak sales.
Their combined market share in China fell to 6.1 percent last month, the lowest level in eight years. This is in stark contrast to the situation in Dec. when their market share soared to 10.6 percent. However, it is fortunate that Hyundai-Kia Motors ranked third in the Chinese market share, following Volkswagen with a 19.2 percent and GM with 12.4 percent.
The result also narrowed the market share gap between Toyota with a 4.8 percent and Ford with 4.8 percent, Nissan 4.2 percent, Honda with 4.2 percent and Peugeot Citroën with 3.2 percent.
Due to Chinese automakers’ low priced products and global automakers’ aggressive promotions, Hyundai and Kia Motors saw the decrease in sales and performance in the Chinese market in the third quarter last year. To prop up the decline in sales back in the third quarter, the automaker launched promotional events and replaced the managerial staff, and was barely back on track in the fourth quarter last year.
To halt a sharp slide in sales there, Hyundai-Kia Motors plans to beef up its strategic marketing and promotion strategy this year according to the economic environment and the new model release plans in the Chinese market. Starting with the Avante and Sportage, it will release the Verna and K2 in the second half of the year, focusing on the C and SUV-segment markets. Moreover, Hyundai-Kia Motors will begin the local production of the Sonata Hybrid and K5 Hybrid models to expand sales in the Chinese hybrid vehicle market.