Don't call Hyundai Motor America a "bottom feeder," its CEO told delegates to the Automotive News World Congress.
Title: President and CEO
Company: Hyundai Motor America
Thesis: Focusing on the dealer
"That means that 82 percent of our customers are A or B" credit risks, O'Neill said. "That tells me that they are mainstream. So we're not bottom feeders."
Hyundai, O'Neill said, has proven to itself and to its dealers that it can sell Hyundais and be profitable. Still, Hyundai has seen its share of hard times and remains fragile, O'Neill said.
The company placed heavy rebates on its vehicles in the 1990s and "it hurt our brand and almost bled us dry," O'Neill admits.
In 1998, the company sold just 90,217 vehicles, a record low.
Then the company began to focus on its dealers and their profitability, he said. It also made sure that it provided dealers with a strong product, good marketing and a dedicated, dealer oriented field staff, O'Neill said.
Over the last two years the company's sales increased 160 percent to 244,391 units in 2000. And without incentives, O'Neill said. The highest rebate the company is offering is $500, he said.
"We're focusing on offering customers value," he added.
O"Neil said Hyundai expects to sell around 300,000 vehicles in 2001. He said most of the increase will come from incremental sales of its Santa Fe sport utility and its XG300 sedan. Hyundai expects to sell 50,000 to 55,000 Santa Fe sport utilities and about 15,000 XG300ss.
In 2000 the company sold 2,004 XG300s and 10,332 Santa Fe models.
Hyundai still has a long way to go O'Neill acknowledged.
It is working with its dealer council to help find ways to improve customer service and the company must be careful that it adds the right products to its line. For instance, he said, Hyundai Motor America rejected a minivan from the Korean parent company because it was underpowered and undersized for the U.S. market.
He said: "We have to be sure not to push the brand too far, too fast."