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How Hyundai lost momentum, and will 'take a few years' to recover

SEOUL/DETROIT/CHONGQING, China — At a near-empty Hyundai Motor showroom in the Chinese mega city of Chongqing, the store manager is grumbling about his shortage of customers and a lack of bigger, cheaper SUV models popular in the world's largest auto market. Even with discounting of as much as 25 percent, his dealership was selling barely a hundred vehicles a month, said the manager surnamed Li. A nearby Nissan dealership was selling about 400 vehicles a month, a store manager there said. "The sales are simply poor," Li told Reuters. "Look at the Nissan store next door, they have tens of customers while we just have two." An hour's drive away is Hyundai's massive $1 billion manufacturing plant, which opened last year with a target to produce 300,000 vehicles per year. But with sales weak and the Chinese auto market slowing sharply, the factory is running at roughly 30 percent of capacity, two people with knowledge of the matter said. The sources asked not to be identified because the information was not public. Hyundai, the world's fifth largest automaker, declined to comment on the Chongqing plant's production or the showroom's sales but said it is "closely cooperating" with local partner BAIC to turn around the China business. BAIC did not respond to requests for comment. Hyundai's woes mark a major reversal for the automaker which was an early success story in China as it quickly and cheaply rolled out popular new models into a surging market. In 2009, Hyundai and partner Kia's combined sales ranked third in China after General Motors and Volkswagen. The South Korean duo now ranks ninth, and its market share in China was 4 percent last year, from more than10 percent at the beginning of this decade. Executives and industry experts say Hyundai conceded its once stronghold in the low-end segment to fast-growing Chinese rivals such as Geely and BYD. Foreign rivals not only defended their turf in premium segments but also kept pricing competitive for mass-market models, squeezing Hyundai's positioning as an affordable foreign brand, they said. In the United States, the world's second-biggest auto market, Hyundai's market share fell to 4 percent last year, near a decade low. Hyundai ran into problems in China and the United States for similar reasons: It missed shifts in consumer tastes, especially the surge in demand for SUVs, and it sought higher prices than its brand image could command, four Chinese dealers and half a dozen former and current U.S.

Hyundai's zombie obsession is just good business

In case you somehow missed it, Hyundai has enjoyed a long and fruitful relationship with The Walking Dead, the critically acclaimed zombie apocalypse show that entertains the masses while they're waiting for the next season of Game of Thrones. Fans of the show will recognize Rick, Michonne, Carol, Maggie and Glenn's mint green Hyundai Tucson, a staple vehicle for the crew of survivors, but the relationship between manufacturer and show goes far beyond that. There's a whole line of Zombie Survival Machines, as well as a special-edition production model (shown above). Heck, even Hyundai's post-LA Auto Show party featured actors staggering about as startlingly realistic walkers (TWD's name for zombies).
So what is it about the dead that quickens the pulse of Hyundai's marketing department? Ward's Auto has a great interview with Steve Shannon, the brand's US vice president of marketing. In it, Shannon describes the sudden nature of the tie-in between the show and the automaker, while describing how the company's corporate overlords in South Korea saw the results of the deal. It's an interesting insight into automotive product placement, as well as Hyundai's marketing philosophy and plans for the future (spoiler alert: the Tucson, which has had a role in the show for several seasons, was seemingly abandoned at the end of season four).
Head over to Ward's and have a look.

Mr. Millen goes to Washington

Ever driven around DC? We have. And let us tell you, people drive like jerks in the nation's capital. Mostly because they think they're more important than you, and they're probably right. But Rhys Millen is out to put them all to shame.
In this latest video, the guy who Red Bull refers to as a "precision driver" (and who the rest of us would call one of the best drifters ever to burn rubber) takes to the streets of the District in his Hyundai Veloster Turbo. There he does what he does best around sites like Capitol Hill, Thomas Circle and RFK Stadium - the one-time home of the Washington Redskins and Montreal Expos (pardon us, "Washington Nationals") - all with a police escort of black Tahoes and Harley outriders. Scope out the action in the video below.