SOUTH KOREA: Hyundai Motor raring to go in US, but brand image holds back XG price

By just-auto.com editorial team | 27 November 2003

The Korea Herald reports that Hyundai Motor Co. plans to launch a large-scale marketing and sales promotion campaign in the United States, as part of its drive to export its way out of slumping domestic demand.

Hyundai says that its US sales unit, Hyundai Motor America, would run advertisements in major US broadcasting and print media and hold promotion events to boost the sale of the XG sedan, its flagship car, for one month from the end of November.

The move comes as part of the company's efforts to shed its old reputation for selling only stripped-down economy cars, the Herald said.

"At a number of blind tests, auto experts put the value of the XG cars at $35,000, but they knocked $10,000 off after learning what they drove was a Hyundai," a company official told the Herald. Thus, the Hyundai XG is available at a market price of $25,000. "Our quality has improved but our brand recognition hasn't yet."

In fact, Hyundai, which had often been the butt of late-night talk show jokes, is increasingly regarded as a value-priced alternative to Japanese cars.

"US consumers visiting a Hyundai showroom are surprised to see that Hyundai offers such high-quality vehicles that can compete with the Honda Accord or Toyota Camry. So our U.S. dealers have asked Hyundai to let more consumers know the facts," the Hyundai official said.

The Korea Herald reported that Hyundai will run prime-time TV commercials on national and local broadcasting channels in fifteen major US cities, targeting customers in their forties and fifties. The company also plans to put its ads on major Internet portal sites and offer $1,000 incentives to 100,000 car buyers in addition to existing benefits, the newspaper said.