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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.

2020 Kia Telluride crossover moves the brand upscale, and a bit off-road

Kia added its newest and largest entrant to its lineup, unveiling the designed- and made-in-America Telluride as its new flagship. It's a handsome and sporty midsize three-row SUV that seats eight, offers upscale interior perks and safety technology, plus off-road capability. The reveal brings the Telluride full circle from its origins as a concept first shown in Detroit three years ago. Kia will emphasize its rugged looks and comfortable, well-appointed interior when it goes on sale later this year as a 2020 model and takes on well-entrenched competitors like the venerable Ford Explorer (itself redesigned for 2020) and the Jeep Grand Cherokee. Designed at Kia's studio in Southern California, the Telluride deliberately harkens to the boxy appearance of O.G. SUVs like the aforementioned Explorer, with a long hood and wide grille, a clean side profile and upright windshield. Nameplates adorn both the leading edge of the hood, atop the grille, and on the liftgate, with stacked headlights, inverted L-shaped taillamps and a sculpted rear skid plate with integrated twin exhaust tips. The Telluride is powered by a 3.8-liter direct-injection V6 making 291 horsepower and 262 pound-feet of torque mated to an eight-speed automatic. There's four-wheel independent suspension and stiff, torsionally rigid body structure owing to an advanced high-strength steel monocoque shell. The rear suspension is self-leveling, with the ride height automatically calibrated depending on the load to benefit control and stability. Four driving modes are offered — Smart, Eco, Sport and Comfort — plus Snow and AWD Lock settings when needed. On-demand all-wheel drive will be an option, distributing torque between the front and rear wheels depending on road conditions and the driver's input. Kia says it's based on electro-hydraulic AWD coupling and constantly redistributes power between the front and rear wheels depending on drive mode — for example, splitting it 65 percent to 35 percent between the front and rear wheels in Sport mode. Inside, there's a wide console that emphasizes the horizontal, with an available 10.25-inch color touchscreen. There's simulated brushed metal and matte-finished wood, interior hooks to hang packs and bags, ceiling-mounted climate control in the second row and reclining third-row seats.

Kia ProCeed GT shooting brake spied ahead of its reveal

Kia plans to introduce its ProCeed GT to the world tomorrow, but our spy shooters just caught a fully camouflaged version out testing on public roads. This five-door shooting brake most likely isn't coming to the crossover-crazed U.S., but it's still cool enough that we thought you'd like to see it. We were thoroughly impressed with the ProCeed Concept shown in Frankfurt last year. If the production car is similar to that, we'll be extremely jealous of everybody in Europe who gets to buy the Stinger-looking vehicle. As far as specs go, Kia hasn't given any hints. Rumors point to a 1.6-liter turbocharged four-cylinder with 201 horsepower and 195 pound-feet of torque as at least one of the available engines. From what we can see on this prototype, the grille has retained its shape and style – even the little GT badge remains. Here's hoping the best bits from the concept make it into production without too many alterations. Kia is definitely getting it right with design as of late with the Stinger and soon-to-be-announced ProCeed GT. Sadly, all that those of us in the U.S. can do now is look from afar. Related Video: Featured Gallery Kia ProCeed GT: Spy Shots View 11 Photos Spy Photos Paris Motor Show Kia Wagon