NEW YORK –Motor America says it will bolster its cross/utility vehicle lineup with a model bigger than the Santa Fe, by early next year.
In addition to its bigger size, the vehicle will be “a unique take on the CUV, with some innovative features,” John Krafcik, vice president-product development and strategic planning, says at the New York International Auto Show here.
Although it shares architecture with the new Santa Fe, it is not likely to be built at’s plant in Montgomery, AL, which by year’s end is expected to be making 60% of the vehicles Hyundai sells in the U.S.
“It’s not decided (where it will be built),” Krafcik says. “It could be built (at Montgomery), but that is probably not likely.”
Output of the revamped Santa Fe, which includes third-row seating for the first time, gets under way at Montgomery in the next few weeks, he says.
The availability of the third-row seat “will open up a whole new market for us,” Krafcik says.
Krafcik, here to unveil Hyundai’s new Elantra 4-door sedan, says additional body styles for the small car are a safe bet. The Elantra, currently sold as a sedan and 5-door hatch, is a critical car for Hyundai, because 58% of those who buy one are repeat customers, he says.
Sales of the car, which competes in the same segment as theCorolla and Civic, should be in the 90,000-100,000-unit range annually, Krafcik says.
Production of the new Elantra will begin at the Ulsan, South Korea, assembly plant this summer and will reach U.S. dealers this fall.
Transaction prices are expected to hover in the $15,000-$16,000 range.
The Elantra was developed in 22-24 months from clay freeze, Krafcik says. “And we’re trying to compress those times, both before and after clay, even more.”
Younger buyers, who gravitate toward the latest trend and who are a staple at Hyundai, are driving those faster product cycles, he says.
Hyundai, which is in its 20th year in the U.S., forecasts sales to top 500,000 vehicles this year and 1 million annually by 2010.
To do that, Krafcik says, Hyundai will need to cover new market segments. Currently, he says, 21% of car buyers shop the brand. About half of the rest are not interested in Hyundai, but the remaining group simply isn’t aware of the brand because Hyundai doesn’t offer the type of vehicle they are seeking.
That’s the customer Hyundai will chase with new entries, such as its Entourage minivan that is reaching U.S. dealers this week.
Also to that end, the auto maker is developing a rear-drive large-car platform for a move upscale. Hyundai will sell the car in South Korea and continues to study whether it needs to establish a new luxury brand to market it in the U.S., Krafcik says. He would not say how soon that car could come here.
Meanwhile, Krafcik says the launch of the new front-drive Azera flagship is raising Hyundai’s average transaction prices and bringing older buyers – where Hyundai is weakest – to the brand.
Azera transactions are averaging $27,000, he says, and more than half of the build mix is going to the top-of-the-line Limited models, many of which are leaving showrooms at transactions above $30,000.
The Azera bases at $24,995 and Limited versions start at $27,495. Buyers average 51 years of age, Hyundai says.