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2018 Hyundai Kona Added to Fast Erupting Small XSUV Segment

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The all new 2018 Hyundai Kona small crossover SUV (XSUV) has just been shown to the press in an event held, wait for it, on the Kona Coast of The Big Island of Hawaii.  There were 23 or 24 Konas on hand for the journalists to drive around the island.  So, this was a pretty big event for Hyundai Motor America (HMA).

In AutoPacific’s 2017 Small XSUV Consultancy, 38 XSUVs with a wheelbase of 110-inches or less are included.  There were enough data to do complete analyses on that many individual vehicles.  There are an additional seven all new small XSUVs on sale now but too new to have been included in the AutoPacific database.  That makes 45 entries in the small XSUV category.  Now comes the 2018 Hyundai Kona wading into the fray.2018 Hyundai Kona F34 View2018 Hyundai Kona Side View2018 Hyundai Kona R34 View

Hyundai Late to the Small XSUV Game  Hyundai is a bit late to the game with its B-Segment small XSUV.  Hyundai mostly thinks “CARS” and was forced kicking and screaming to develop another small SUV.  Before the Kona was developed, Hyundai Motor Corporation (HMC) offered Hyundai Motor America a small XSUV developed mainly for India.  Luckily for HMA, their parent company did not push that down their throats and the result is the Kona – a bit late, but a whole lot better.  Next year, an even smaller A-segment XSUV will be introduced along with a larger range topping three row seven passenger XSUV (like the old Veracruz).  So, it appears HMC got religion and is providing HMA with what it needs to compete.

Trucks to Reign as Cars are De-emphasized  As carmakers begin providing what consumers are really asking for – crossover SUVs – the shift from traditional three-box (hood, cabin, trunk) cars will accelerate and the two-box bodystyle will predominate.  Truck sales (pickups, SUVs and minivans) outpaced cars in 2010 and now account for about 64% of the market.  Crossover SUVs first outsold traditional (body-on-frame) SUVs in 2004 and never looked back.  As the small XSUV segment matures, it should command between 17% and 20% of the market of light cars and trucks in the USA.

Kona Competitive Set per Hyundai Motor AmericaHugely Competitive Segment  Hyundai’s planners identify eight primary competitors for the 2018 Hyundai Kona – Chevy Trax, Honda HR-V, Jeep Renegade, Toyota C-HR, Subaru Crosstrek, Mazda CX-3, Ford EcoSport and Nissan Kicks.  With 45-plus entries in its size category sold by popular brands and premium brands alike, Kona goes up against some solid heavyweights.

Kona Styling    The proportions of the 2018 Hyundai Kona are different.  It has a long hood with long front overhang and a very short rear overhang.  Stylists have achieved a aggressiveness and muscularity in a small package.    The front end is has the Hyundai shield grille flanked by large headlights buried in a charcoal surround.  LED running lights top the front fascia just at the leading edge of the hood.   The bodyside has bold character lines flowing towards the rear.  The wheel arches are swathed in charcoal cladding.  The cladding may be overdone, but Kona appears to pull it off pretty well.  Once you study the Kona for awhile, it grows on you.

Kona Size – Smaller, But Does Not Feel Small  Among Kona’s competitive set, it has the shortest overall length (164.0-inches).  Its wheelbase (102.4-inches) is pretty much in line with competition.  The cockpit feels spacious and its dimensions are in line with its competition.  The rear seat is a skosh small with only the Toyota C-HR having less rear seat legroom.  While you might think Kona skimped on cargo area it has not.  Its 19.2 cubic foot cargo area is mid pack.  Only the Honda HR-V and Subaru Crosstrek larger.

2018 Hyundai Kona CockpitPowertrains – About What You’d Expect in this Class of XSUV  There are two engine/transmission combinations.  The base engine is a Nu 2.0L Atkinson cycle 4-cylinder with 147-horsepower and 132-lb.ft of torque.  The 2.0L is teamed with a 6-speed automatic transmission.  The base engine powers the lower two of the four Kona models.  The top engine is the Gamma 1.6L GDI 4-cylinder Turbo mated to a 7-speed EcoShift DCT.  It has 175-horsepower and 195-lb.ft. of torque.  Both powertrains are rated at 30mpg combined city/highway fuel economy.  All wheel drive is available on both powertrains and all models.

Hyundai SmartSense  Kona is available with an array of driver assistance technologies in the Hyundai SmartSense Suite.  SmartSense includes forward collision-avoidance assist, rear cross-traffic collision warning, lane keeping assist, high beam assist, blind spot warning and driver attention warning.  In AutoPacific research, a blind spot warning system is a feature with very high demand.  Hyundai has made it standard on the Sonata mid-size car, but in the Kona it is standard one-step up from the base SE model in the SEL model.  Still, this is good compared with competitive installations.

Attractive Pricing  The base SE model starts at $19,500 (without destination).  The highest volume model likely will be the SEL with a starting price of $21,150.  It is available with a $1,500 technology package. The next step is the Limited at $24,700.  Check all the boxes until there are no more and you come to the Unlimited model at $27,400.  The Unlimited is where you get an 8-inch touchscreen with navigation, head-up display and  the full Hyundai SmartSense suite of safety features.

No Vehicle is Perfect  As vehicles and technology evolve buyers are expecting more.  For instance, the 2018 Hyundai Kona has an 8-way power driver seat available, but only manual adjustment (without a height adjustment) is available on the passenger side.  Cruise control is standard, but adaptive cruise control that most buyers expect today is not yet available.  Hyundai’s planners hint that adaptive cruise is only a short time away.

In Summary  The 2018 Hyundai Kona promises to be a very competitive entry in the small XSUV category.  A buyer won’t miss much, if anything at all, if they select a Kona.  This is a vehicle that Hyundai Motor America has needed and has been waiting for.  Now it is up the dealers and marketing/advertising folks to get Kona into the consideration sets of prospective buyers.  It should do very well.


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“Trucks” to Continue to Outsell Cars – XSUV Segment

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500 wide Car Truck Sales 1987-2021500 wide Car Truck Mix 1987-2021AutoPacific, an automotive specialist research and product planning consultancy, forecasts that trucks, including XSUVs will be about 60% of the market for the foreseeable future.  In fact, reading the crystal ball for the next five years, this percentage of the mix may be low.  The charts above detail how cars and truck sales and market penetration have evolved since 1987 and the forecast for the future.

The hottest product segment in the American light vehicle market is the crossover SUV (XSUV).  A crossover SUV can be as large as a Chevrolet Traverse or as small as a Chevrolet Trax.  There are dozens of XSUVs in between.  And there will be more.

The XSUV segment has become so hot because this type of vehicle corrects the criticisms buyers had of traditional SUVs which sold very well, but were not optimal.  Buyers wanted products that were not hard-core off-roaders, but more civilized and city friendly.  The SUV market exploded in the early 1990s with the introduction of the Ford Explorer and Jeep Grand Cherokee.  It wasn’t until 1996 that the crossover SUV began slipping into the marketplace.  First the Toyota RAV4 and Honda CR-V appeared.  They were followed by the luxury crossover RX300.  Clearly the manufacturers were listening and reacting.

Here are just a few of the things we know about the evolution of the SUV market over the next five years…

Cadillac  Cadillac states that it has too few XSUVs (one, the upcoming XT5) and wants to add two or three more to its lineup while adding one more car as a range topper between now and 2020.

Buick  Buick is adding the small Envision XSUV to its lineup this Spring.  Envision is assembled in China.

FCA Drops Cars to Add XSUV and Pickup Capacity  Fiat Chrysler Automobiles is dropping its Chrysler 200 and Dodge Dart in favor of more capacity for XSUVs and pickups.  The Ram pickup will take over the FCA Sterling Heights, Michigan Plant when the Chrysler 200 is dropped.  FCA’s huge Belvidere, Ilinois plant will be populated by XSUVs when the Jeep Compass and Patriot plus the Dodge Dart fade away.

Toyota Pushing RAV4  Toyota Motor Sales has stated that they would not be surprised if the RAV4 XSUV overtook the Camry mid-size car as its best selling product.  Camry was the best selling car in the USA in 2015.

Lexus will add a 3-row XSUV above the RX350 in the next few years.500 wide SUV XSUV Sales 1987-2021500 wide SUV XSUV Mix of SUV 1987-2021

 

The charts above show the impact of crossover SUVs on the light truck market.  Huge volume increase and market share increase.

Hyundai Aggressively Adding XSUV Capacity  Hyundai is replacing 50,000 units of car capacity in its Montgomery, Alabama assembly plant with the Santa Fe Sport.  That drops capacity for the Hyundai Sonata and Elantra from 400,000 to 350,000 units per year.  Hyundai admits that they underestimated the demand for XSUVs years ago.  This capacity move reacts to market demand and dealer pressure to get Hyundai dealers more XSUVs that are easier to sell and require less incentives and discounting.

Hyundai will add 45,000 units to its Tucson compact XSUV volume this year.  Built in South Korea, Tucson has been limited because it is popular around the world and the vehicle was capacity constrained.

Hyundai also recognizes there is a hole at the bottom of their XSUV lineup and are adding a sub-compact B-Segment XSUV to fill that hole.  There is a possibility that a smaller A-Segment XSUV will replace the Hyundai Accent hatchback.


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