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Hyundai sales slump in China over North Korea, standoff with Chinese partner

BEIJING/SEOUL — Hyundai is at loggerheads with its Chinese partner over efforts to cut supplier costs, as they grapple with cutthroat competition and the impact of a standoff between Beijing and Seoul. Hyundai, along with affiliate Kia, has been caught up in a political row over a missile defense system that is being deployed in South Korea, but opposed by China, as tensions grow over North Korean missile tests and last week's test of a nuclear bomb the North claims can be mounted on a missile. Sales of Hyundai cars in China have been falling, part of a backlash against South Korean brands over the missile system that China views as a threat to its own national security. On Tuesday, South Korea asked the United States to lift a limit on the explosive payloads it can use in the missile system. This as a North Korean missile, believed to be an intercontinental ballistic missile, was being tracked by intelligence services being moved on the ground toward North Korea's west coast and a possible launch site. That has come against the backdrop of ever tougher competition from local Chinese automakers. Until last year, Hyundai and Kia ranked third in China by sales. But Hyundai's sales alone have slumped 41 percent from January to July, fraying relations with local partner BAIC Motor Corp and making this the biggest crisis since Hyundai entered the Chinese market in 2002. Last month, Hyundai suspended production at its four China plants for a week after a French supplier refused to provide fuel tanks when its bills went unpaid. On Tuesday, Hyundai suspended production at one of its plants in China after a German firm went unpaid. Hyundai and BAIC — whose Beijing Hyundai joint venture is a 50:50 partnership — are divided over how to solve the issue of suppliers and tougher competition. Hyundai wants to protect its South Korean supply chain, while BAIC favors shifting to cheaper Chinese suppliers to cut costs, the people said. "BAIC wants to solve this aggressively and is ... asking Hyundai to change its sourcing strategy significantly and immediately," said the head of a Hyundai supplier based in Seoul, adding the idea was to source more locally from cheaper suppliers in China. Hyundai wants to solve this more gradually "over perhaps 5-10 years and do so in phases," the person said. BAIC declined to comment.

First 2015 Hyundai Sonata ad surfaces

The new Hyundai Sonata just made its debut at the 2014 New York Auto Show, but it's already begun making its slow march towards dealers, meaning it's about time we start seeing ads for the new family sedan on the TV and internet. This 62-second spot is one of the first.
The ad places a particular focus on styling, and what great design really is. There's also a glimpse at the super-cool gesture control that's baked into the Sonata's infotainment screen. We'll admit, we're pretty geeked to give this feature a full test once we finally drive the all-new sedan.
As for when that will be, with the car set for an arrival at dealers this summer, we're hoping to have a full write-up on the 2015 Sonata soon. Until then, scroll down for the full ad from Hyundai.

We want a Hyundai with this N prototype's crackly engine

Hyundai produces quality, mainstream machinery, but with the exception of the Genesis Coupe and Veloster Turbo, it hasn't brought many enthusiast-oriented vehicles to the table. Hyundai plans to change that with their in-house performance brand, N. The group will develop race cars and high-output versions of production cars, and if this prototype video is anything to go by, Hyundai N products will sound fantastic. The video shows what looks to be a Hyundai i30 hatchback, which we get in the States as the Elantra GT. And it sounds wonderful with a cackling, popping exhaust reminiscent of a rally car. Hyundai has not confirmed whether we will get this car or engine. We wouldn't be surprised if we didn't get the car, since a new generation Elantra hit dealers not long ago. As far as the engine, we certainly hope we will get it eventually, whether it's in an Elantra or something else – Veloster N anyone? Either way, we will get a slightly hopped-up Elantra Sport soon. Hyundai showed the Korean-market Avante Sport recently, which Hyundai confirmed would become the US-market Elantra Sport, more or less. It will feature the same 201 horsepower engine of the Veloster Turbo, and if it sounds even half as impressive as the i30 N prototype, it should tide us over while we wait for our own N-badged model. Related Video: