- Mar 29, 2006
Sonata incentives pile up as Hyundai tries to meet sales goals
Moving 150,000 units of any vehicle is no easy task, and it looks as if Hyundai is learning this the hard way with its recently introduced Sonata. The incentives continue to climb - currently they're averaging just over $2,000 per vehicle - and fleets currently represent 30% of the Sonata's sales. The car is sitting on lots longer, with the "turn" time climbing from 41 days to 74 days. Transaction prices have also slid, dropping by over $900 in the last six months. We're not sure that this is what Jerry Flint had in mind with his warning last week about the Korean automakers, but certainly it's not a great situation for a brand-new model.
Hyundai has stated that the increased fleet sales are a good way to get "butts in the seats", and the increased turn time is being attributed to a production increase that ensures sufficient dealer inventory before the manufacturer's Alabama plant starts Santa Fe production this summer.
More than anything else, this goes to show the difficulty of cracking into the highly-competitive midsize sedan market. Nearly every competitor is throwing its best effort into this class, and indeed the segment as a whole is seeing increased incentives and longer turn times. The upside is that consumers have plenty of great midsize sedans from which to choose.
[Source: Automotive News]