They're made in Alabama. Selling them there should be easy.
That's what Gordon Stewart thought when he opened a $3 million Hyundai dealership outside Birmingham in January 2006. After all, the Korean automaker had just christened a $1 billion assembly plant 90 miles away. The plant employs more than 3,000.
But after less than two years in business, Hoover Hyundai has closed.
"You'd expect there to be some loyalty," says Stewart, whose family owns Chevrolet dealerships in Michigan, Florida and Georgia. At a store in suburban Detroit, Stewart says: "90 percent is employee business. That's not the case in Alabama. Nobody here even knows they're made in Alabama."
Stan Hurst, general manager at Capitol Hyundai in Montgomery, says about 17 percent of his sales are to Hyundai factory employees, about what he expects. "It's not like in the old days when if you were in a place that had a GM or a Ford factory, you owned the town," Hurst says.
Stewart says Hyundai has not done a good enough job communicating the brand in the United States. "The product is excellent. I've never had an issue with the cars," he says. "I've had an issue with their marketing."
In what was Hoover Hyundai, Stewart is expanding his Toyota dealership. The Toyota store is already the No. 1 volume seller in the state.
"It was a worthy experiment," Stewart said of the Hyundai franchise. "But as a businessperson, I'm far better off with a Toyota sign outside."