In the auto business, 2011 proved to be the year of the Koreans; both Hyundai and affiliate Kia sold a record number of vehicles, while their shares outperformed those of other automakers, including the likes of heavyweights such as General Motors, Toyota and Volkswagen.

That said, some of the sales in new vehicles from the Koreans actually cannibalized others within their ranks, notably the Kia Optima (K5 in South Korea), which after its latest redesign saw orders triple, though some of that came at the expense of Hyundai’s Sonata, which only saw demand increase by some 5.2 percent in the same period.

There’s every chance the same thing could happen again with Kia planning to launch the more upmarket K9, designed to go after the same customers as the Hyundai’s Genesis and Equus.

Frank Ahrens, a spokesman for Hyundai said the car-to-car rivalry between the two brands extends to all segments. Further complicating matters is the fact that although Hyundai and Kia are overseen by the same chairman (Chung Mong Koo) and share a development center, they are run as two separate companies and arch rivals at that.

There’s no question that Hyundai’s original 51 percent purchase of Kia Motors back in 1998 rejuvenated the brand and helped it grow into a purveyor of world-class vehicles with competitive prices. All the same, the companies need to sort out their differences now more than ever because it seems global competition is going to intensify in 2012 especially with Honda and Toyota returning to pre-disaster capacity.

This will likely mean Hyundai and Kia will need to develop a successful alignment strategy for their respective product lines, for example: focusing one brand on premium products and the other on volume sales. In doing so, they stand a greater chance of stealing sales from Japanese, American and European rivals instead of each other.

It seems that signs of greater product differentiation between Hyundai and Kia’s offerings are afoot; Kia’s European COO, Paul Philpott, said during a recent interview that “Hyundai will become the mainstream brand with Kia [functioning as] the sportier, dynamic little brother.”

[Source: Bloomberg]

Hyundai appears to be strengthening its position in the hybrid marketplace, announcing that the Sonata Hybrid will get a lifetime warranty on its battery pack.

Hyundai hopes that by offering a lifetime warranty on the Sonata Hybrid’s battery that it’ll persuade buyers still skeptical about the long-term life of a hybrid battery. Hyundai CEO John Krafcik recently told Car and Driver that they “can afford the program because the failure rate is so low.”

Through some rigorous testing, Hyundai has seen “minimal degradation of its output or duration of operation” of its Sonata Hybrid’s battery pack, even after 300,000-miles of use.

Those were the only details that the Korean automaker announced, so it’s unsure whether or not the coverage will extend to other hybrid components. Either way, it’s a big step up from Toyota, which only offers an eight-year/100,000-mile warranty on its hybrid batteries.

[Source: Car&Driver]

Read AutoGuide’s 2011 Hyundai Sonata Hybrid Review Here

For a long time, the only brand with a poorer reputation than Hyundai was Kia. Despite being a subsidiary of Hyundai, Kia‘s vehicles were often a grade lower in quality, using decade-old Mazda engineering and projecting an image of cheap vehicles for those with poor credit (or poor taste).

Now, Kia is on a roll, with sharp designs and technology borrowed from Hyundai, which has become a segment leader in many respects. Kia’s Optima sedan is outselling the Hyundai Sonata in their home market of South Korea, something few would have predicted even a year ago.

Executives at Hyundai fear that sales cannibalization will occur if action isn’t taken to differentiate the brands. Hyundai is said to become the more premium, upscale brand while Kia will take on a sportier image. In the United States, the company’s lineups have a lot of overlap, but in the rest of the world, more differentiation exists, and Kia and Hyundai have established dominant positions in different reasons.

[Source: CNBC]

The results for the most successful cars of 2011 so far are in. Automotive data and marketing solutions company Polk has calculated the results from the first six months of 2011 new vehicle registrations and have come up with the top picks for non-premium and premium models.

These results look at model-level performance and determine which ones are doing well so far this year. It’s also important to note that the March Japanese earthquake/tsunamis have had an impact on these results, and the inventory shortages for Toyota and Honda caused by the disaster have impacted the June 2011 CYTD (Calendar Year To Date) retail results for these brands.

Here’s a list of the winners so far, along with the June 2011 CYTD year-over-year improvements in new retail registrations.

Non-Premium

1. Hyundai Sonata (+32%)

2. Volkswagen Jetta (+69%)

3. Ford Fiesta (not on sale in 2010)

4. Chevrolet Cruze/Cobalt (+178%)

5. Jeep Grand Cherokee (+170%)

Other non-premium models that performed well in the first half of 2011 include the Optima, Regal, 200/Sebring, Durango, Elantra and Equinox.

Premium

1. Cadillac CTS (+54%)

2. BMW 5-Series (+56%)

3. Jaguar XJ (+273%)

4. Porsche Cayenne (+178%)

5. BMW X3 (+276%)

An honorable mention goes out to the Volvo S60, another premium model that has performed well in 2011.

[Source: Polk]

The all important metric of “conquest sales”, vehicles which steal owners away from another brand, has a new king, the Hyundai Sonata. The Korean automaker’s mid-size sedan has been a smash hit, and evidently done its part to steal consumers aware from other manufacturers.

A report by automotive analytics firm Polk suggests that for every 100 customers Hyundai loses when they abandon the Sonata for another competing product, they gain 365 customers who end up purchasing a Sonata. Furthermore, Hyundai has a retention rate of above 50 percent, proving that the company’s success isn’t just a flash in the pan.

[Source: Polk]

After an employee committed suicide at a Hyundai plant in Korea, the company reports that it has resumed production.

The employee of Hyundai’s South Korea factory accused the company of “suppressing the labor movement,” forcing the company to shut down on Thursday and meet with labor officials. An agreement was made with the union, and the plant will resume building the Sonata and Korean-market Grandeur (what we once got as the Azera).

“We have resumed production from 6:15 AM today and will do Saturday and Sunday works as previously planned,” said a union official.

[Source: Reuters]

Hyundai is taking the fight to General Motors‘ OnStar System by offering its Blue Link system as standard equipment. The Blue Link system is capable of providing direct connection to emergency services but also delivers traffic and weather updates as well as allowing owners easy access to roadside assistance. The system also lets users pair their smartphones to locate the vehicle in crowded parkinglots. The system will also keep track of the vehicle position and how fast it’s being driven.

Hyundai also improved the fuel efficiency of the Sonata. The base 2.4-liter four-cylinder engine now gets 24 mpg, gaining 2 mpg in the city and 35 mpg highway. The Sonata equipped with the 2.0-liter turbocharged four-cylinder will now get 22 mpg and 34 mpg highway, an increase from 33 mpg highway in last years model.

Hyundai states that the Sonata leads all mid-sized sedans in fuel economy, excluding hybrids.

Hyundai will apparently launch a competitor to the Toyota Prius in 2013, but the new hybrid Hyundai will be a plug-in hybrid vehicle from the get-go, unlike its Japanese rival, which is slowly rolling out its own plug-in variant.

While the news came from an anonymous source within Hyundai, the Korean automaker is making a strong push in the hybrid segment, as rising gas prices and the launch of the Sonata Hybrid sedan have put Hyundai in an excellent position. Hyundai is also buoyed by Toyota’s hamstrung hybrid lineup, which has seen production difficulties due to Japan’s March 11th earthquake. Hyundai is projecting annual sales of 18,000 units for the Sonata Hybrid in South Korea.

[Source: Reuters]

At the unveiling of the 2013 Chevrolet Malibu, chief engineer Mark Moussa took some time to discuss the future of the car with the folks at egmCarTech, and Moussa took great lengths to tout the advantages of the new Ecotec 4-cylinder engine and the Malibu’s sporting character.

Naturally, Moussa was pressed on the possibility of a V6, SS or Hybrid variant. Moussa implied that the new Ecotec motor would deliver the benefits of a V6 with none of the trade-offs, leading us to conclude that the Malibu will follow the Hyundai Sonata in remaining exclusively a 4-cylinder, and leave the larger Impala to carry the V6 torch. Moussa was also non-commital regarding an SS variant, and a turbocharged Ecotec could fill the role nicely while competing with cars like the Hyundai Sonata 2.0T.

Finally, Moussa said that the Malibu Eco, which uses the eAssist mild hybrid system, is adequate for the car’s current needs, and didn’t comment on any further hybrid models.

[Source: egmCarTech]

For all the fuss about Hyundai‘s success in the United States, the Korean automaker is making even bigger waves in Canada, where the brand reigned supreme for Q1 of this year.

While truck sales far outpace car sales in Canada (just like in America – and both markets are topped by the Ford F-Series), Hyundai managed to beat out everyone else in passenger car sales, besting Toyota (including Scion and Lexus) by 219 units and GM by 1,654 units, for total sales of 18,704 cars.

But the race is hardly over, and without a proper truck, Hyundai still lags behind Ford, GM and Chrysler, were which buoyed by their lineup of pickups and other truck-based products. It’s interesting to note that Canada’s light-truck sales are still strong even in the face of higher gas prices (the $4/gallon threshold was passed long ago). On the other hand, passenger cars sold in Canada tend to be small compacts, and Hyundai chose to reveal their 2012 Accent at Canadian auto shows before they made their American debut. With the Accent, Elantra and Veloster all capable of 40 MPG, the brand looks well positioned to do very well in the Canadian marketplace, even if it is a relatively small one.

[Source: Sympatico Autos]