South Korean brands Hyundai and Kia are planning to unseat the biggest players in the UK new car market.
Hyundai has now followed sibling brand Kia by revealing its aim for a top five spot in the sales charts by the end of the decade.
Based on last year’s 2m market, achieving such a postion would require the brands to outsell the likes of Nissan, BMW and Audi.
Combined, the two would be ahead of Vauxhall and only just behind current number one Ford.
Few, however, believe that Hyundai and Kia can’t achieve their bold aims. They are already the fastest growing brands on the UK market – Kia expects to be selling 100,000 a year by 2020, up from an expected 70,000 this year and Hyundai UK boss Tony Whitehorn also expects to hit six figures in that timeframe, up from around 75,000 this year.
Kia has just had its best ever first quarter in the UK since the scrappage years. The brand sold 19,204 vehicles, up from 17,211 in the first three months of last year, while Hyundai, at 20,000, was ahead by 12.5 per cent over 2012.
The only issue facing both brands is a shortage of cars – Hyundai and Kia’s global factories cannot cope with global demand. “We have reached a point where demand is ahead of our global production capacity which in the current climate is not a bad place to be,” Whitehorn tellsHeadline Auto.
“The company is looking at the capacity issues and in the meantime we will concentrate on the brand image. In a very short space of time, over the past four to five years, we have gone from a budget brand to mainstream. Our networks, marketing and the way we deal with customers has to reflect this.
“We are finding that customers’ expectations from us are increasing all the time and so we have to manage this ready for the next sales push in 2015.”
According to Hyundai’s Aftersales director Nick Tunnell the brand’s growth since the scrappage years has brought in new customers, many of whom had not used a franchised dealer before.
The launch of an online survey last year has highlighted some interesting points, he adds. “Whereas our previous telephone surveys were very much box-ticking exercises, online responses have proved to be much more detailed.
“For example, while people will say they enjoyed the sales or service experience as a whole, they were disappointed with the coffee, the seats or even the toilets. These are small points but we need to address them.”
To improve the ‘brand experience’ Hyundai is making its servicing schedules easier to understand and more transparent in pricing and providing extended five year servicing plans which are fully transferable to a new owner, even on older vehicles.
“We are raising standards at dealerships including workshops and back end facilities. Our technicians our now highly trained and need to work in an environment that reflects this and the technology in our vehicles,” Tunnell says.
The company is also looking at carrying customer reviews online but is still looking at the detail. “People now rarely stay in a hotel without looking at reviews first. We have to plan how we go about this and in terms of intent there is a need to be as transparent as possible.”
Hyundai currently has 153 UK dealers and is looking to increase this to 165 by the end of the year, and according to Tunnell the brand has a queue of people wanting to join the network due to growing sales.
Whitehorn says as Hyundai grows, the brand needs larger, regional dealer groups rather than the smaller ‘owner-drivers’ of the past. “The small, family-owned dealerships still have their place but in metropolitan areas we need businesses that can handle a throughput of 500 cars a year.”