Hyundai Motor Group defied analysts' projections today by reporting a 1 percent gain in U.S. sales for the month of April as the Hyundai and Kia units dipped into their pocketbooks to offer bigger incentives on cars.
Hyundai Motor America said its sales rose 3 percent to 68,009 units last month, setting a new April record. Kia Motors America said it had the second-best April in its history with 53,282 units sold, a 1 percent drop from last year's record total.
"For six years in a row we’ve set April sales records going into the spring selling season," Bob Pradzinski, vice president of sales at Hyundai’s U.S. sales arm, said in a statement. With the spring launch of hybrid and plug-in hybrid versions of the Sonata midsize sedan, he said, "we are well poised to keep this momentum going."
Yet the Korean automaker's modest gains came at a price.
Hyundai spent $2,710 per car on incentives last month, a 48 percent increase over the previous April, according to data from the car-pricing service TrueCar Inc. Kia's incentives rose 26 percent to $2,758 per car.
Industrywide, per-car incentives rose just 1 percent in April as automakers such as Ford Motor Co. and General Motors tightened their purse strings to take advantage of a booming market for trucks and crossovers.
Some companies spent more than Hyundai and Kia in dollar terms, but none spent more per dollar of sales, TrueCar data show. Hyundai's incentives as a share of transaction prices rose to 11.5 percent while Kia's rose to 11.6 percent. Chrysler, with a ratio of 10.5 percent, was the only other automaker in double digits.
Yet April’s sales results show that Hyundai and Kia, which have long specialized in small cars, are showing success with more expensive, more profitable cars. Sales of the Hyundai Genesis luxury sedan, which has started at $38,950 since its redesign last year, rose 142 percent in April to 3,159 units.
Kia reported that sales of its redesigned Sorento crossover rose 15 percent to 9,808 units while sales of the Sedona minivan increased fourfold to 3,394 units. It was not enough to make up for the brand's cars, all of which posted sales declines. Sales of the boxy Soul subcompact, Kia's second most popular model after the Optima midsize sedan, fell 21 percent to 11,418 units in April.