NEW YORK -- An additional Hyundai assembly plant in North America is among the options under review as the company nears a decision on where to add crossover production capacity around the globe, Hyundai’s top U.S. executive said.
No decision has been made, but Dave Zuchowski, CEO of Hyundai Motor America, expects one to come this year to solve Hyundai’s longstanding crossover capacity shortage, which that has caused Hyundai to lose U.S. market share to rivals that can churn out more hot-selling CUVs.
“We know that we need additional production capacity. Where that’s going to be we don’t know, but we’re much closer to a decision than we have been in the past,” Zuchowski said in an interview on the sidelines of the New York auto show on Wednesday. “It’s widely recognized that the absence of more capacity in the crossover segments has hurt our market share and we have to address that.”
One proposal getting a close look in the “big global chess game” of Hyundai’s production planning effort: Whether to add a plant in North America that will produce the Santa Fe crossover, which is built at Kia’s plant in Georgia. Is demand sufficient for Kia to make up for that loss?
An alternative possibility under review is Hyundai seeking additional capacity through Kia’s new plant under construction in Mexico.
“I honestly think there will be a decision sometime this year. That’s encouraging,” Zuchowski said. “There’s a lot of very specific conversations and cost analysis and optimization of production planning discussions, and we’re definitely making progress on those.”
In the meantime, U.S. availability of the redesigned Tucson compact crossover will see a big increase after it goes on sale in late June or early July. Zuchowski estimates enough inventory will arrive to support roughly a 50 percent gain in sales this year from the 47,306 units it sold last year. Next year, Hyundai will get enough Tucsons to support around 90,000 units, Zuchowski said.