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HYUNDAI

ON FAST TRACK A S T H E N E X T T O Y O TA

Hyundai is now the world’s fourth largest auto manufacturer; the frog that amazed by turning into the handsome Prince. Colin Chinery talks to Hyundai South Africa’s Marketing Director Stanley Anderson about a brand that is taking on the old giants and winning.

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Hyundai FEATURE

R

emember the perennial status tag for Hyundai…’Not Ready for Prime Time’? Well into the baggage of history it goes. For Hyundai, Prime Time is here. Last autumn the Korean automaker leapfrogged past Ford to become the world’s fourth largest producer. And according to Jez Frampton, CEO of international consulting agency Interbrand, Hyundai Motor’s global brand recognition is set to grow as Japanese rival Toyota Motor Corp deals with an expanding recall. “They seem to be a brand that’s moving and shaking. Toyota has a great brand. Hyundai is in the process of building a great brand.”

At Hyundai South Africa we are really flying With passenger car share 10% and rising, Hyundai South Africa’s Marketing Director Stanley Anderson is no less bullish.” At Hyundai South Africa we are really flying at the moment. I’m trying to dig out the exact reasons but I’m too busy selling cars!” Among them the recently-launched supermini Hyundai i20: stylish and spacious, combining comfort, safety and reliability in a package both affordable and economical. And latest of the fast-sellers is the Hyundai iX35, successor to the mighty Tucson, which along with the i20s predecessor the Getz, Anderson attributes the five year resurgence of the once Death’s Door Hyundai South Africa brand. With the i10, i20 and i30 already available here, the fourth-generation compact SUV has dropped the Tucson badge and emerged as the iX35. “Within two and half weeks of its launch we’ve already doubled the average monthly www.southafricamag.com

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Hyundai FEATURE

Tucson sales” says Anderson, 45 year old exMercedes exec. The new iX35 Hyundai is a sleek crossover of athletic proportions. It’s bigger, bears a sharper-looking facade and comes with a luxurious interior cabin as part of a move up market. Pitched as an urban car rather than an outdoor 4×4, this stylish newcomer is equipped with the newest fuel-efficient engines and 6-speed manual and automatic transmissions. “As a family all-rounder with decent soft-road capability,” says motoring writer Dave Abrahams, “it fits the bill with style and comfort at prices that’ll have its competitors very worried indeed.” The new iX35 represents the evolution of the brand’s exterior and interior design, through the introduction of ‘fluidic sculpture’, an architectural language which in the words of Thomas Buerkle, Chief

Designer at Hyundai Motor Europe, gives a first impression of a “striking appearance generated through feminine sculptural layers combined with broad, athletic proportions.” “Hyundai is benefiting from a perfect storm,” says James Bell, market analyst for Kelley Blue Book. “It’s a result of introducing new products while Honda’s mainstream vehicles, like the CR-V and Accord, are a bit stale, and Toyota is experiencing a huge consumer-perception crisis.” Hyundai surpassed both Toyota and Honda in February in Kelley Blue Book’s ranking to become No. 1 in customer loyalty. And says Anderson, the brand’s new drive is Quality. “We want people to say they are buying Hyundai not because of its value for money but because of its quality. “With the iX35 we are starting to attract a different customer. We are seeing BMWs

Hyundai is now becoming the focus in South Africa

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and Mercedes Benz being traded in on iX35s. People are looking at the BMW X1 just launched and saying, for R60-R70, 000 less the iX35 has better spec, is the better looking vehicle, and ‘I’ll buy the Hyundai’. “So the resistance to the brand, especially in the premium segment has definitely declined a lot. I’d say this has happened over the last 18 months since we launched the i20 which has also been extremely successful. Through communications, marketing and quality, Hyundai is now becoming the focus in South Africa. “There is money out there and people want the new models and the new cars. They’ve recovered, they are back on track as far as factors like the home loan and bond payments, and there’s a very positive sentiment across South Africa. And I think the World Cup’s got a lot to do with it. We’ve launched a couple of promotions around the World Cup and this is doing the brand a lot of good. People are excited about 2010 and when they are positive they may buy.”

Long renowned for high spec and value for money, Hyundai is developing a reputation for reliability, backed by a five year warranty. It is a brand moving up from the ‘Inexpensive’ to the ‘Affordable.’ “We’ve got a fantastic range of vehicles, one of the best in the market even against Toyota and VW in terms of price and spec levels,” says Stanley Anderson. For Hyundai SA, dealership relations, after sales service, customer care and staff training and retention are core to success. “We communicate extremely well with our dealers, fifty per cent of whom are independently-owned. For four years in a row we have come out top in a survey in which dealers’ rate manufacturers/importers. “Customer service – especially after sales service - is paramount for us. We tell our service managers that the salesman sells the first Hyundai and the workshops the second and third.” Staff training and retention is critical says Anderson. Hyundai South Africa has a www.southafricamag.com

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Hyundai FEATURE

dedicated training centre and sponsors and equips six State technical schools. Internal recruitment and promotion is another priority. One example; After Sales Director Michael Rohde started on the bench twenty years ago. In 2008 the South African auto market dropped by 50% and last year by another 25%. Despite this Hyundai SA sold the same volume in 2009 as in 2008, gaining 1.5% share of a declining market. “One of the main impacts in our market was the interest rate. It went up to 15.5%, but over the last 18 months has come down and is now sitting at 10%. This makes a big difference in terms of affordability and finance approvals.”

As interest rates came down the market bottomed out. Resurgence appeared at end of last year and up to April 2010 the SA’s market is up 15% while Hyundai SA sales increased by 75% year on year. “When interest rates hit those highs major bank car repossessions climbed to 7,000 a month in a market of 25,000 cars a month. A huge proportion of new vehicle sales were repossessed and most of the cars auctioned were less than 18 months old. Customers became clever, knowing they could get a car at 60% -70% off market value. “The banks took an absolute hiding. And for the South African auto sector this had more impact than the global recession as such.”

We tell our service managers that the salesman sells the first Hyundai and the workshops the second and third

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Anderson moved to Hyundai SA at the start of 2001, shortly after acquisition by Imperial’s distribution arm, Associated Motor Holdings had saved it from liquidation. “I’ve never been scared of a challenge. At Mercedes Benz I took over the Colt pick ups, launched a new range and in three years brought it up to be one of the top three light commercial vehicle sellers. “I was head hunted for this position at Hyundai and I thought well, there is nothing like a challenge. I believe its much easier getting to the top than staying there. “The first three years were hell. We had six and a half thousands cars in stock and were retailing 200 a month at that time. Fleet companies wouldn’t see us, rental companies wouldn’t buy our cars. That’s all gone. This year we’ll sell 10,000 cars to rental companies. “I always say that with a good product you can build a brand. We are a serious player in the market and we are going to be the next Toyota.” END

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