This Hyundai SUV plant is running at maximum capacity to meet demand

Hyundai’s assembly plant in Alabama, which makes the Tucson midsize SUV, is running three shifts at full capacity, and the automaker is investing $400 million to expand the facility.
By : Bloomberg
| Updated on: 28 Aug 2020, 08:16 AM
Hyundai’s US plant is running flat out to meet demand for sport-utility vehicles. (File photo) (MINT_PRINT)
Hyundai’s US plant is running flat out to meet demand for sport-utility vehicles. (File photo) (MINT_PRINT)
Hyundai’s US plant is running flat out to meet demand for sport-utility vehicles. (File photo) (MINT_PRINT)
Hyundai’s US plant is running flat out to meet demand for sport-utility vehicles. (File photo)

Hyundai Motor Co’s US plant is running flat out to meet demand for sport-utility vehicles, and the company’s top North American executive says it will need to consider expanding production capacity if that continues.

The South Korean automaker was slow to transform its lineup to meet Americans’ penchant for SUVs but now is capitalising on a rebound in showroom traffic following pandemic-related US shutdowns. Sport-utility vehicles were 67% of US retail sales in July, thanks to the Tucson and Palisade models, according to Jose Munoz, Hyundai’s chief executive officer of North America. That surpasses the company’s 2023 goal of 63%, he said in a phone interview.

Similar Cars

Find More Cars
Hyundai Elantra 2022 (HT Auto photo)
UPCOMING
Hyundai Elantra 2022
1999 cc | Petrol | Manual
₹16 - 20 Lakhs* *Expected Price
Hyundai Elantra (HT Auto photo)
Hyundai Elantra
1999 cc | Petrol | Manual | 15 kmpl
₹17.83 - 21.27 Lakhs**Ex-showroom price
Hyundai Tucson (HT Auto photo)
Hyundai Tucson
1999 cc | Petrol | Automatic (Torque Converter)
₹22.55 - 27.47 Lakhs**Ex-showroom price
Hyundai Tucson 2022 (HT Auto photo)
UPCOMING
Hyundai Tucson 2022
1999 cc | Petrol | Automatic
₹23 - 28 Lakh* *Expected Price
Hyundai Casper (HT Auto photo)
UPCOMING
Hyundai Casper
999 cc | Petrol | Manual
₹4 - 7 Lakhs* *Expected Price
Hyundai Santro (HT Auto photo)
Hyundai Santro
1086 cc | Petrol | Manual | 20 kmpl
₹4.67 - 6.47 Lakhs**Ex-showroom price

“I’m very confident that we will be able to maintain at least 60%," Munoz said, “and perhaps even more." Even when competitors have a good supply of products, “we’re having a very solid performance."

Hyundai’s assembly plant in Montgomery, Alabama, which makes the Sonata and Elantra sedans and the Tucson midsize SUV, is running three shifts at full capacity, and the automaker is investing $400 million to expand the facility to build a compact pickup truck, the Santa Cruz, in 2021.

“Total production, once we stabilise from Covid, will be close to 400,000 units, and we will need more," he said. “At some point we will have to discuss about potentially increasing capacity."

More Expansion

He didn’t provide any details, but this could mean more expansion at the Alabama factory or even building a new plant.

While Hyundai sales were up 1% in July compared with a year ago, they were down 15% for the year-to-date. Despite this, Munoz predicted deliveries will grow in 2020, even with a more-grim outlook for the broader industry. He expects U.S. sales to decline this year, and 2021 to total 15 million, a loss of 2 million cars from 2019’s 17 million.

Researcher IHS Markit estimates sales this year will sink to 13.6 million.

“There are many, many dynamics going on, but the net result is going to be negative," Munoz said. “While we see some recovery, we don’t see a full recovery" for the industry.

First Published Date: 28 Aug 2020, 08:16 AM IST
Recommended For You
View All
NEXT ARTICLE BEGINS

Please provide your details to get Personalized Offers on

Choose city
+91 | Choose city
Choose city
Choose city
By clicking VIEW OFFERS you Agree to our Terms and Privacy Policy

Dear Name

Please verify your mobile number.

+91 | Choose city