DATE=05/11/02

TYPE=BACKGROUND REPORT

TITLE=HAPPY HYUNDAI

NUMBER=5-51603

BYLINE=JOHN BIRCHARD

DATELINE=WASHINGTON

INTERNET=

CONTENT=

INTRO: These are heady days for Hyundai (PRON: rhymes with "Sunday"), the South Korean automaker. The company has broken ground for its first North American assembly plant, a billion-dollar facility in (the southern U-S state of) Alabama. Hyundai's U-S sales have grown by over 40-percent a year for three straight years. V-O-A's John Birchard reports.

TEXT: After a bad stumble over poor quality nearly five years ago, Hyundai has stormed back in the U-S market by vastly improving vehicle quality, backing its vehicles with a generous warranty and keeping prices down.

For those who have not been paying attention, Hyundai Motor America Vice-President of Marketing Dave Weber says, his company is no longer marketing only small, entry-level cars.

/// WEBER ACT #1 ///

We've actually expanded our product line-up to six vehicles. We've got everything from the entry-level Accent that starts around nine-thousand dollars, all the way up to our X-G-350 near-luxury sedan, which tops out at about 25-thousand-500-dollars.

/// END ACT ///

The engineering editor for Road & Track magazine, Dennis Simanaitis (PRON: "Simmon-eye-tis"), sees this expansion as a sort of growing up.

/// SIMANAITIS ACT #1 ///

We're seeing them maturing as an auto company, where they're not just making things that seem to be perfect for the Korean market, but for the world market.

/// END ACT ///

/// OPT /// The poor vehicle quality that plagued the brand and dragged down U-S sales a few years ago, says Hyundai's Dave Weber, is old news.

/// WEBER ACT #2 // OPT ACT ///

We really have made tremendous strides in terms of improving the quality. This has been indicated by several syndicated studies, as well as our own ownership scores.

/// END ACT // END OPT ///

The latest model in Hyundai's line-up is a new version of its sporty coupe, the Tiburon (PRON: "Tibber-ahn"). The new car is longer and wider, providing more interior room. It has bigger, better brakes and a V-6 engine producing 181 horsepower. Road & Track's Dennis Simanaitis likes the car's power, and the new look.

/// SIMANAITIS ACT #2 ///

Generally, I like the styling a lot. People say, "Oh, it's derivative of the Ferrari 456." Fine. That's okay with me, I mean, you know, a Ferrari 456 look for 20-thousand dollars? I'll buy it.

/// END ACT ///

Price range for the Tiburon is 16-thousand dollars for the base, four-cylinder version, up to 20-thousand for the V-6 with six-speed manual transmission and all the safety, comfort and convenience options. Dennis Simanaitis says the direct competitors are the Toyota Celica and Mitsubishi Eclipse.

/// SIMANAITIS ACT #3 ///

I think it competes very well against both of those and the Acura R-S-X as well. Its long suit (strength), of course, is price. You know, it's priced less expensively than those three.

/// END ACT ///

The slick, new Tiburon is a good example of the present-day Hyundai, a brand that has "the big boys" (big industry players) both in the United States and Japan looking warily over their shoulders. But Dave Weber says his company still has some way to go to catch Toyota and Honda.

/// WEBER ACT #3 ///

We are looking really to grow Hyundai into what we refer to as a "tier one" brand. And what we mean by that is a brand of preference, or choice, by consumers.

/// END ACT ///

That's a tall order. But, considering where it was five years ago, Hyundai looks like a reasonable bet to achieve its goal. (Signed)

NEB/JJB/TW