Another article about another manufacturer, this time Hyundai, planning to sell 1 million in the US. Sounds similar to what is happening in India.
A funny thing happened to Hyundai on the way to selling 1 million units a year in the United States. The feisty Korean carmaker hit a brick wall.The grand plan to get to a million by 2010? No chance.
This year's sales goal is 512,000, slashed from 555,000. But dealers are behind last year's pace, when full-year sales were 455,520. That's a long way from a million.
Now Hyundai's overreaching bosses in Seoul have gone from pushy to panicky.Korea's reshuffling of managers at Hyundai Motor America is getting monotonous. The revolving door has led to a chaotic strategy that has dealers dazed and confused. "It will be very hard to get a person to come work with them," said Bill Underriner, president of Underriner Motors of Billings, Mont. "The team is always changing." U.S. execs keep changing tactics, with moves that smack of anxiety and indecision. Hyundai's latest reversal is to bring back dealer ad associations -just nine months after getting rid of them. Hyundai also plans to increase ad spending dramatically in 2008. Sales chief Dave Zuchowski says Hyundai will run commercials during the Super Bowl for the first time next year, at a cost of as much as $2.7 million for a 30-second spot.
The bottom line for Hyundai: The United States is not as easy a market as it once looked. In 2003, with its annual sales around 400,000, Hyundai took dead aim at a million by 2010, after a growth spiral fueled by a 10-year warranty. But sales stalled two years ago, and Hyundai began firing and changing managers and reworking strategies.
COO Steve Wilhite, who was hired from Nissan in August 2006, quit last month. Hyundai Motor America CEO Ok Suk Koh will handle the company's sales and marketing until a replacement is named. Wilhite had replaced Bob Cosmai, who was ousted in January 2006. Cosmai had been head of sales under Fin O'Neill, who had held the job from 1998 to 2003, when he left to head Mitsubishi Motors North America Inc. O'Neill's two predecessors, Robert Parker and Doug Mazza, had been replaced. Bill Wallace, owner of Wallace Hyundai in Stuart, FIa. says "It gives you an uncomfortable feeling in your gut. The Koreans are calling the shots. They're impatient. It's discouraging. They're not in touch."
Key U.S. executives have been swept out for not meeting sales targets. In February 2007, Zuchowski, an exMazda executive, replaced Mark Barnes as head of sales, and Joel Ewanick replaced Michelle Cervantez as head of marketing.Ewanick was lured from Hyundai's ad agency, Richards Group, and his first act was to fire his previous employer.
Wilhite was hamstrung from the beginning. No sooner had he arrived than Korean management saddled him with an impossible goal: Sell 555,000 units this year.As late as April, Dong Jin Kirn, CEO of Hyundai Motor Co. in Seoul, said he still thought Wilhite could hit the goal. When Wilhite quit in September 2007, the sales target was cut. At the National Automobile Dealers Association convention in Las Vegas in February, dealers complained about lack of continuity in top management.
Hyundai sold 455,520 vehicles in 2006, almost exactly the same as the year before. Yet the Korean bosses stuck to their plan to reach 555,000 units this year. In September 2007, they cut that target to 512,000. But even 512,000 is ambitious. Through September 2007, Hyundai dealers sold 358,407 units, down 0.2 percent from the same period last year.
Last edited by vasudeva : 14th November 2007 at 14:36.
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