Hyundai is betting demand for the Sonata will only increase with the launch of new turbo and hybrid models in the coming months.
Hyundai expects its sales to exceed 500,000 units for the first time this year with the help from strong sales of the red-hot Sonata.
The percentage of consumers considering a Hyundai product is steadily increasing, according to John Krafcik, Hyundai Motors America president and chief executive officer. The percentage of light vehicle intenders looking for a Hyundai was only 7% at the end of 2000. Today, that has risen to 33%, Krafcik said.
“We’ll set an all-time sales record this year, passing 500,000 units,” he added, noting the increase in sales has been paced by the successful launch of the Sonata, which is winning buyers in the highly competitive mid-sized car segment.
In fact for the four-month period from May through August, the Sonata was the top model shopped market-wide, Krafcik said, citing various industry data.
Hyundai’s market share has continued to grow, he added. The South Korean automaker’s overall market share is currently 4.8%, more than twice that of Mazda and ahead of Volkswagen, as well. The expansion has been based a steady growth at the retail level not through fleet sales like some of its competitors.
Thus, the Sonata now outsells mid-sized competitors such as the Nissan Altima, Ford Fusion and Chevy Malibu at the retail level, Krafcik said, and the Sonata’s “days to turn,” a measure of a vehicles sales potential, is now the best in the critical mid-sized segment.
“We’re actually capacity constrained. If we had more we could probably sell more,” he said.
(Efforts to adjust operations at Hyundai’s U.S. assembly plant are underway and aimed at boosting Sonata output.)
The incentives on the Sonata are also the lowest in the segment, while givebacks on the Toyota Camry and Honda Accord have increased dramatically. The average incentive on the Sonata is currently $1,516, while the numbers average $3,429 and $2,938 on the Camry and Accord, respectively, according to information collected by Autodata.
At the same time, the transaction price for the Sonata – what buyers actually pay, on average — have strengthened and should improve in the next few months as the automakers extends the Sonata line with the addition of a turbocharged model and a the new Sonata hybrid. (Click Here for the 2011 Hyundai Sonata Hybrid review.)
Sonata is also bringing Hyundai new customers from other brands. “Most of the conquests are coming from the Japanese big three, Honda, Nissan and Toyota,” Krafcik said. “Compared to Camry and Accord, Sonata buyers are also more likely to come from luxury brands,” such as Cadillac, Lexus and Acura and BMW, he said.
Krafcik also said the demographics of Sonata’s buyers are comparable to those of Camry-Accord buyers. Median family income for is $72,000, 32% have college degrees and they also have the best mean FICO scores, which are used to measure creditworthiness, in the segment.
(Hyundai Sonata is one of only two models to get a 5-star rating under new NHTSA crash testing. Click Here for the complete story.)