Research firm puts spotlight on Hyundai for sales gains
AUTOMOTIVE INDUSTRY Predicts 80,000 vehicles a year for Korean maker Market estimated at 17.94 million by end of decade
Hyundai Auto Canada Inc. will make some of the biggest gains in the Canadian vehicle market during the next five years, says a leading consumer- research agency.
U. S.- based J. D. Power and Associates said yesterday at a market briefing that industry sales in Canada for the remainder of the decade will steadily improve after two years of decline, and Hyundai will be one of the biggest beneficiaries.
Impressive gains in quality and awider selection of models from the Korean auto maker will drive sales up from almost 60,000 last year to slightly more than 80,000 annually by 2010, according to J. D. Power.
Hyundai’s sales have already climbed 50 per cent in the last four years, and the company has shed its image of shoddy quality from a generation ago. In the first 10 months of this year, the company’s business has jumped almost 10 per cent, while the market has improved only 3.2 per cent. The forecast for gains would increase Hyundai’s share of the Canadian market from 4.2 per cent to 7 per cent by the end of the decade, J. D. Power added. Every percentage point in market share represents more than 15,000 vehicles.
In a chart titled “ Hyundai: Major Threat to All,” J. D. Power said that, in addition to increasing quality, the auto maker is offering strong value. Hyundai will introduce a minivan for the first time here next spring. Some speculate the company may offer a truck during the next few years. The company is also building an assembly plant in the United States.
J. D. Power predicts Canadian sales will climb about 5 per cent from 17.03 million in 2005 to 17.94 million in 2010.
J. D. Power also said DaimlerChrysler Canada Inc. will raise its market share from about 13.8 per cent to 15 per cent as sales grow about 10 per cent during the next five years. The research firm said sales at Nissan Canada, including the luxury Infiniti division, will jump during the next two years because of growth in small cars and sport-utility vehicles, but then volumes will stay flat for the remainder of the decade, pushing shares up slightly to 5 per cent.
Jeff Schuster, J. D. Power’s executive director for global forecasting, said in a presentation the market will reward companies that take design risks.
That means some auto makers, such as Honda Canada Inc., which has conservative designs and limited new- product launches, will generate flat sales and a slight dip in market share during the next five years after getting an initial bounce from the new Civic compact model and Ridgeline truck.
Toyota Canada will also lose a small amount of market share, the research firm said.
Ford Motor Co. of Canada Ltd. will make a marginal improvement in market share to 14 per cent after a lengthy slide, but industry leader General Motors of Canada Ltd. will lose a small amount of the market and fall to 27 per cent by 2010. On the production side, J. D. Power said auto output in Canada will range between 2.5 million and 2.7 million vehicles annually for the next five years.