No Compromise [Fleet Management May 2012 Print Edition]

Korean car makers storm the Canadian market

June 11, 2012
by Thomas D’Monte

From the Fleet Management May 2012 Print Edition

Even the most passive car buyers likely clued in to the meteoric rise of Hyundai and Kia after the Korean automakers earned all three finalist spots for the 2012 Canadian Car of the Year award. The new Hyundai Elantra compact sedan would go on to take both the Canadian top honour and Car of the Year at Detroit’s North American International Auto Show.

With each new product launch, the Seoul-based companies are showing a dedication to cutting-edge design, quality manufacturing and value for the customer. And that’s creating new options for savvy fleet buyers looking to make smart purchases.

The first sign of Hyundai’s onslaught of class-leading vehicle designs came with the 2011 Sonata mid-size sedan. It replaced the bland, box-on-wheels philosophy that had long relegated the automaker to “affordable choice” status. Now, the new Sonata, Elantra, Accent sub-compact and Tucson CUV all impress, with sheet metal featuring bold creases, swooping lines, and what Hyundai describes as an appearance of motion while standing still.

The design story was a little different at Kia. Back in 2006 the company managed to snag long-time Audi-Volkswagen designer Peter Schreyer. He’s the man who penned the popular Audi TT sports coupe. Schreyer has been slowly putting his fingerprint on Kia’s new designs, and with great success. The award-winning 2011 Optima mid-size sedan introduced a new sporty and muscular exterior, a driver-oriented cockpit, and the company’s new trademark front grill. Earlier this year Kia won another coveted international Red Dot Design Award for its subcompact Rio sedan. For fleet buyers, it means the smart, affordable choice does not have to be drab and utilitarian.

The Koreans have also taken leaps forward in levels of engineering, manufacturing standards and materials. The engines are state-of-the-art, employing technologies including direct injection, turbocharging, and fuel-efficient options like Kia’s Idle Stop and Go. That system allows the engine to turn off at a stoplight, and then starts up again when you hit the gas.

In terms of overall quality, Consumer Reports recently named the 2012 Rio as its top choice among small cars, beating out the popular Ford Fiesta and Chevrolet Sonic. Much of that decision apparently came down to the attention paid to interior fit and finish. It’s true that if you haven’t sat inside one of the redesigned Korean offerings yet, you’re going to be surprised.

The interiors now have soft-touch plastics across the tops of dashboards and everywhere you rest your hand. You’ll still find some of the harder stuff hidden at the bottom of doors, but that overall low-rent appearance is long gone. The designs are modern, and all the seams are tight. It’s not going too far to say that the Koreans are now on par with the Japanese when comparing most models on design, quality and engineering.

Canadian consumers are taking notice. Hyundai Canada marked its best year ever in 2011, selling more than 129,000 vehicles. That was an increase of more than nine percent.

“Canadian consumers went looking for stylish, high-quality vehicles that deliver incredible fuel economy and value for their hard earned dollar,” says Hyundai Canada president and CEO, Steve Kelleher. “What they found was a strong line-up of Hyundai vehicles that delivered.”

Continuing that trend, both Hyundai and Kia marked their best sales ever for the month of March; Hyundai was up eight percent compared to March 2011, and Kia soared by 22 percent.

When you survey prices on the base model mid-size sedans—each equipped with automatic transmissions—the competition is tight. The Honda Accord SE has an MSRP of $26,090. The Hyundai Sonata GL undercuts that at $24,299. But Toyota aggressively slashed prices on the redesigned 2012 Camry LE. It’s now a great value at $23,700. And pricing is equally competitive in the compact car segment, with the base model Civic, Elantra and Corolla all priced within $1,500. Yes, Toyota and Honda still have the edge when it comes to resale value, but the new Korean competition is quickly closing that gap.                  b2b