Hyundai faces growing pains in Australia

HYUNDAI is gearing up for 100,000-plus annual sales in Australia with improved internal processes and better dealer facilities in order to manage its growth sustainably.

However, while this means better customer care training and more flexible access to servicing garages, the number of dealerships will likely stick to about 160 outlets nationally.

“This year (sales) will be in excess of 100,000 cars, and that will be the first time in the company’s history,” Hyundai Motor Company Australia chief operating officer John Elsworth told GoAuto at the Genesis first drive event in South Korea this week.

“It is a significant milestone. The first time you do over 100,000 units in the auto industry, it’s almost like you’ve grown up as a company, you’ve matured.

It will be a turning point.

“(As a result) we’re trying to install a lot of discipline processes within our business … to support that number, and that lets you leapfrog to the next level."Mr Elsworth said the policies Hyundai would implement will ensure that the growth continues and the company is prepared for what comes next.

“It’s things like the way dealers order cars from us so we can properly order future production… they’re internal processes.

“The service capacity is probably an issue going further. We’ve done studies on that. We don’t need more dealers… we don’t see that as where we need to be to growing." Mr Elsworth said that while a dealer expansion is off the cards, making the servicing hours more flexible is a high priority for the car-maker.

“Our plan is to increase dealer throughput going forward, and increasing dealer service throughput going forward as well.

“That will put a strain on our service operations, so our next phase from a dealer growth point of view is expanding our workshops, expanding the operating times – whether that be afterhours or on weekends – and in the mid-to-long term, more unique service operations. I think that’s the next phase we’re going into.”

To help hit the 100,000 sales level this year, Hyundai will undertake a series of campaigns and promotions that are in line with market demands.

With sales currently up four per cent, against an industry down three per cent, Hyundai is edging closer to Mazda with 9.0 per cent market share against its Japanese competitor's 9.6 per cent share.

“We will sustain (our growth for the rest of the year),” Mr Elsworth said.

“When I say we have targets, we hit our targets. So for the last 24 months we have grown month on month, and we plan to grow every month for the balance of the year.

“Ours is a business where we do not miss targets, and we adjust our business (accordingly). It’s a very flexible business we’re dynamic about how we make our decisions and we’re very quick.

“To deliver the volume you want you have to do things differently to what you’re used to. Whether that’s price or spending more on promotion or whatever, you still have to be more aggressive to achieve your volume, especially when the market is coming down.”

However, Mr. Elsworth insisted Hyundai is not obsessing over catching Mazda for third place behind Holden and market leader Toyota.

“We don’t really have any plans to chase down Mazda,” he claimed.

“We don’t sit around and talk about it at all. We have our goals and our targets, and everyone is focussed on that. If that means at one point we jump them, then so be it.”

Last year Hyundai sold a record 97,006 vehicles for a six per cent increase in volume over 2012’s tally, while Mazda’s total of 103,144 units was down 0.7 per cent over compared to the year before.