When Hyundai Motor Co. (005380) last overhauled the Sonata in 2009, motorists embraced the curvier exterior and the South Korean company went on to gain more market share than any major automaker for the next half decade.
Today, Hyundai is betting on a repeat jolt as the Seoul-based carmaker released the first images of the seventh-generation sedan, which competes against Toyota Motor Corp.’s Camry, Honda Motor Co.’s Accord and Ford Motor Co. (F)’s Fusion. Hyundai plans to make a fuller unveil this month in Korea and display the car at the New York auto show in April.
After being marred by record recalls, a worsening currency-exchange rate and its first annual profit drop in five years, Hyundai could use another hit product. The vehicle will be the second one to be overhauled under German-born Peter Schreyer, who took the helm of both Hyundai and Kia Motors Corp.’s designs in January 2013.
“The Sonata was the model that made consumers re-evaluate Hyundai from a maker of budget cars to one that made stylish and appealing cars,” said Shin Chung Kwan, an analyst at KB Investment & Securities Co. “With the upcoming Sonata, the company is hoping to take another step up.”
Since it was first introduced in 1985, the Sonata has sold more than 6.8 million units worldwide and was Hyundai’s second best-selling model behind the Elantra in the U.S. last year.
The remodeled Sonata in 2009 surpassed Nissan Motor Co.’s Altima and General Motors Co.’s Malibu. Annual sales of the model almost doubled in the U.S. by 2012 following the revamp, according to company data.
The Sonata was ranked by J.D. Power and Associates as the most dependable midsize car in their 2013 study.
The car drew the admiration of some auto executives.
The Sonata “changed the game in that segment by having a highly stylized car,” Jim Lentz, head of Toyota’s U.S. operations, said in an interview in September.
Still, global deliveries of the car fell to 476,103 units last year after peaking at 523,320 in 2011, as competitors introduced fresher offerings. Toyota redesigned the Camry in 2011 and the latest generation of the Ford Fusion was unveiled in 2012.
For Hyundai, much hinges on the success of the next Sonata, which will be the most important model for Hyundai this year. Its bestselling Elantra, winner of 2012 North American Car of the Year, isn’t due for a major change until next year.
“The all-new Sonata has evolved again,” Park Jeong Gil, head of Hyundai Motor Group’s engineering design division, said in a statement. “It will play an important role in further facilitating our shift from quantitative growth to qualitative growth.”
The overhaul comes as Chairman Chung Mong Koo, head of both Hyundai and Kia, is forecasting the weakest sales growth in eight years for 2014 as competition intensifies and the stronger won hampers exports.
Hyundai in December named Dave Zuchowski to replace U.S. CEO John Krafcik, who had led the U.S. unit for five years, after market share there slipped. Hyundai’s U.S. sales rose 2.5 percent last year, a third of the industry average growth pace, according to data from the company.
Also, Hyundai and Kia agreed in December to spend as much as $395 million to settle lawsuits related to claims that they overstated the fuel-economy ratings of their vehicles.
Hyundai’s shares fell 1.6 percent to 242,000 won at the close in Seoul trading, trimming this year’s gain to 2.3 percent.
The 2015 model year Sonata will be the second car after its Genesis premium sedan to be unveiled implementing Hyundai’s “fluidic sculpture 2.0” design theme, a continuation of the philosophy that helped hint at speed and the looks of expensive European models.
Competition will be intense. The new Sonata will be coming up against offerings from traditional leaders, Toyota’s Camry and Honda’s Accord to the Ford Fusion.
To appeal to customers, Hyundai said it seeks to offer a “sense of premium quality in every detail” in the new Sonata, which will feature a hexagonal grille, longer wheelbase and more ergonomic cushion design to improve seat comfort.
“The new Sonata will offer improved quality, better mileage, and have a milder but more sophisticated look,” said Lee Sang Hyun, an analyst at NH Investment & Securities Co. “This will help Hyundai capture a broader audience and boost its sales in global markets.”
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