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Hyundai, Kia ratchet up fleet sales as retail transactions slide

Automotive News reports both Hyundai and Kia have stepped up fleet sales in an attempt to offset disappointing first quarter results. The Korean automakers saw their sales decline by nine percent compared to last year, while all major competitors managed to increase their sales. That situation marks an inversion of two years ago, when both gained ground after Japanese rivals suffered production and inventory shortages after the country's earthquake and tsunami tragedies.
Now, Hyundai can't come up with enough volume models in popular trim configurations to satisfy buyers, and lower-volume models are also in a snag. At the moment, Hyundai can only build 20-30 percent of Veloster hatchbacks with turbocharged engines while the US market would apparently support closer to 70 percent.
In order to reverse the sales slide, Hyundai and Kia have stepped up fleet sales of the vehicles they do have by some 50 percent, ringing up a total of 42,400 units in the first quarter. By contrast, Automotive News reports the seven largest automakers increased retail volume by seven percent and fleet sales by four percent as a group.

K900 probably won't be last time Kia goes alphanumeric

This is part of an effort to ensure that the vehicle brand itself registers with consumers more than the model name.
The new Kia K900 luxury sedan stands as a four-wheeled flag in the ground of the financially fertile turf of the world's premium automakers. It's a bold move for a Korean manufacturer that was best known for inexpensive MSRPs and easy credit only a few years ago. The company has made sure it has the requisite trappings of premium motoring: indulgent size, rear-wheel drive, a powerful V8 engine, real wood trim and rich leather seats. It has also ensured the model has another important earmark of luxury - an alphanumeric name. These days, everyone from Audi to BMW to Cadillac to Lexus to Volvo rely on a jumble of letters and numbers to make up their model names. We've been told this is all part of an effort to ensure that the vehicle brand itself registers with consumers more than the model name.

Kia calls reports of second US plant 'groundless'

In discussing how Kia planned to use a focus on quality to raise its brand perception and take the fight to BMW and Audi instead of Toyota, a recent article in Automotive News Europe said one of the primary constraints was production capacity; Kia simply doesn't have the ability to make enough cars to meet its aims with the plants it has.
The CEO of Hyundai-Kia is said to be reluctant to build more plants because of that focus on quality and the fact that its suppliers are stretched to the limit. The effects of that position are being felt right now with both makers losing market share, as in the case of Hyundai not being able to make enough of its Veloster Turbo for the US market.
A South Korean newspaper apparently reported last week that Kia was planning to build a second factory in Georgia with capacity for up to 150,000 units annually, and that the company would break ground as soon as this month on "KMMG2." Kia has responded to the news by saying, "The report is all groundless." The mayor of West Point, site of the current KMMG plant, said he didn't know anything about such plans, nor did the Georgia department of economic development have knowledge of a new Kia factory.