South Korea’s largest automaker may account for 10 percent of sales in Canada five years from now, Steve Kelleher, chief executive officer and president of Hyundai’s Canadian unit, said in an interview today. That compares with the company’s 8.2 percent market share this year through July and Toyota’s 10.2 percent.
Hyundai passed Honda Motor Co. in 2010, 27 years after it entered Canada with the Pony model. Kelleher said the company is benefiting from Canadians’ preference for smaller cars and a move to sport-utility vehicles from minivans.
“It’s going to be an extremely big challenge for us, but we are certainly going to go after it, we would like to own 10 percent market share in Canada,” Kelleher said by telephone from the Toronto suburb of Markham. “We are firmly established as one of the large players in the market.” Hyundai is on pace to sell 140,000 cars this year in Canada, its highest total ever, he said.
The top three selling brands in Canada are Ford Motor Co. (F) with 16.5 percent of sales this year through July, Chrysler Group LLC with 15.8 percent and General Motors Co. (GM) at 13.5 percent, according to DesRosiers Automotive Consultants Inc.
Canada was the Seoul-based company’s first overseas market, opening three years before the U.S. Hyundai can grow here by adding features “at an accessible price,” Kelleher said. He cited the addition of heated seats across its lineup as an adaptation to Canadian winters.
“When we entered the market, I don’t think Canadians had any perceptions of Hyundai,” he said. “We were able to come into the market and fill a void that had been created by the rest of the manufacturers kind of abandoning the low end.”
“One thing that hasn’t changed is Canadians’ desire for small cars,” he said. “When you look at some of the luxury brands, and they are trying to out-tech each other and out-feature each other and at some point that becomes redundant.”
Higher Canadian sales haven’t led the company to plan a factory in the country. “I’m a Canadian, I’d like nothing more than to have an assembly plant here, but from a business point of view it doesn’t make sense,” Kelleher said, without being specific.
The 60-year-old Toronto native has led Hyundai’s local unit for a decade and has been with the company for 27 years after leaving a job at a Ford parts depot.
With the sales forecast for this year there is no sign that customers are being weighed down by Finance Minister Jim Flaherty’s warnings about record consumer debt linked to a housing boom, Kelleher said.
“We haven’t seen any slowing or locking down of credit available” on auto financing, he said.
“We keep looking at those numbers on debt and all the low financing on housing,” Kelleher said. “It’s a concern for the future that if interest rates do rise, what kind of an impact that’s going to have on all the major purchases.”
To contact the reporter on this story: Greg Quinn in Ottawa at firstname.lastname@example.org