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Hyundai sales slump in China over North Korea, standoff with Chinese partner

BEIJING/SEOUL — Hyundai is at loggerheads with its Chinese partner over efforts to cut supplier costs, as they grapple with cutthroat competition and the impact of a standoff between Beijing and Seoul. Hyundai, along with affiliate Kia, has been caught up in a political row over a missile defense system that is being deployed in South Korea, but opposed by China, as tensions grow over North Korean missile tests and last week's test of a nuclear bomb the North claims can be mounted on a missile. Sales of Hyundai cars in China have been falling, part of a backlash against South Korean brands over the missile system that China views as a threat to its own national security. On Tuesday, South Korea asked the United States to lift a limit on the explosive payloads it can use in the missile system. This as a North Korean missile, believed to be an intercontinental ballistic missile, was being tracked by intelligence services being moved on the ground toward North Korea's west coast and a possible launch site. That has come against the backdrop of ever tougher competition from local Chinese automakers. Until last year, Hyundai and Kia ranked third in China by sales. But Hyundai's sales alone have slumped 41 percent from January to July, fraying relations with local partner BAIC Motor Corp and making this the biggest crisis since Hyundai entered the Chinese market in 2002. Last month, Hyundai suspended production at its four China plants for a week after a French supplier refused to provide fuel tanks when its bills went unpaid. On Tuesday, Hyundai suspended production at one of its plants in China after a German firm went unpaid. Hyundai and BAIC — whose Beijing Hyundai joint venture is a 50:50 partnership — are divided over how to solve the issue of suppliers and tougher competition. Hyundai wants to protect its South Korean supply chain, while BAIC favors shifting to cheaper Chinese suppliers to cut costs, the people said. "BAIC wants to solve this aggressively and is ... asking Hyundai to change its sourcing strategy significantly and immediately," said the head of a Hyundai supplier based in Seoul, adding the idea was to source more locally from cheaper suppliers in China. Hyundai wants to solve this more gradually "over perhaps 5-10 years and do so in phases," the person said. BAIC declined to comment.

2016 Hyundai Tucson shows off its European trim ahead of Geneva

Hyundai is unleashing the first details about its next-generation Tucson ahead of the crossover's official debut at the 2015 Geneva Motor Show on March 3. So far, the Korean automaker is only talking about European specifications for the latest model that goes on sale in the second half of 2015 there. Still, this glimpse should give a good idea of what to expect from the future version inevitably coming to the US. The new Tucson largely blends the look of the current Santa Fe and last year's Intrado concept into a more angular, rugged CUV than the current model. As in the earlier teaser video, Hyundai's designers gave the latest generation horizontal, chrome-accented slats in the hexagonal grille to match the look of the other recent members in the lineup. The hood also takes on the somewhat flatter design from the Santa Fe, but the lower air dam wears an eye-catching mix of intakes, foglights and LEDs. In profile, there's a distinctive crease down the side, and the wheel wells subtly reinterpret the squared-off look from the Intrado. Inside, Hyundai claims that it focuses on improving material quality, and it's offering an attractive new Wine Red leather interior with black contrast to European buyers. There are also available heated and ventilated seats, and a faster infotainment system. The company is upping the safety assists too with features like Autonomous Emergency Braking, Lane Keeping Assist, Blind Spot Detection and more. These European models are made in the Czech Republic and offer quite an array of powertrain options. The gasoline choices are either a naturally aspirated 1.6-liter four-cylinder with 133 horsepower or turbo 1.6-liter mill with 174 hp. Diesel selections include a 1.7-liter with 113 hp, 2.0-liter with 134 hp or another tune with 182 hp. Transmission possibilities are either a six-speed manual or automatic, but the 1.6-liter turbo is available with a seven-speed dual clutch. North America will likely get its own drivetrain mix, though. Hyundai didn't release too many shots of the new Tucson. But we'll have live images from the Swiss show floor in a few weeks time.

Is Hyundai's conservative new Sonata struggling out of the gate?

"But so far, Sonata sales are up compared with last year even while we're still ramping up to full speed," - Jim Trainor
According to Reuters, the redesigned-for-2015 Hyundai Sonata is not enjoying the same degree of success in the early going as the previous sixth-gen model, which proved to be one of the most important models in the company's history and ushered in the company's so-called "Fluidic Sculpture" design language that we still see today. Citing a recent review from The New York Times that called the car's more conservative styling "bland" and "boring," Reuters also points to analysts who claim the higher price of the new Sonata, as well as smaller rebates and incentives, are hurting sales. Honda and Toyota both offered anywhere from $600 to $800 more on the hoods of their Accord and Camry sedans last month.