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Hyundai boosted production in March, so now its cars sit in U.S. ports

SEOUL — As Detroit's automakers shut production in March due to the coronavirus pandemic, South Korea's Hyundai cranked up its factories back home to ship cars to the United States, a move that is proving costly for the world's fifth-largest auto group. Hyundai ramped up domestic production to as much as 98% of capacity by late March, not only as the Korean market was recovering from a bad February but also because it bet on demand for Tucson SUVs and other models from U.S. customers, its biggest overseas market outside of China. While Hyundai is one of few global automakers whose production has recovered at home, its exports optimism has been dampened by the severity of the U.S. outbreak, weak consumer sentiment and as rivals have quickly moved to guard their turf. Consignments of cars shipped from South Korea are now sitting in U.S. ports, with dealers slow to take deliveries because of slumping sales and rising inventory, four people with knowledge of the matter told Reuters. The company idled a Tucson production line at home last week for five days, while sister firm Kia is looking to suspend three Korean plants for a week. And analysts now expect a sharp drop in first-quarter operating profit when it reports results on Thursday and some even forecast a second-quarter loss. "I hope that the situation will recover by the middle of next month. If not, we might have to lay off some people," said Brad Cannon, general manager of an exclusive Hyundai dealership in California, whose sales are down more than 50% from when the pandemic started. Hyundai runs a factory in Alabama — which is closed until May 1 — but imports are key to meet U.S. demand. Only about half of its vehicles sold in the United States are made in North America compared to between 68% and 85% for Japanese rivals Toyota, Nissan and Honda, who have also suspended production there till May. The South Korean company makes about 61% of its cars overseas, up from 48% a decade ago. That leaves it vulnerable to overseas factory shutdowns and shrinking demand outside of its home market. Hyundai's South Korean factory operation, which had recovered from a component shortage from China to nearly 100% capacity by March, could fall to as much as 70% in April, the company recently told analysts. "We will continue to monitor the situation and take appropriate action promptly," Hyundai said in an emailed statement. Minimizing the impact For its part, Hyundai has taken measures to minimize the impact.

Hyundai Motor's two R&D vice chairmen reportedly resigning

SEOUL — Hyundai Motor Group's two vice chairmen in charge of research and development have offered to resign, three people familiar with the matter told Reuters on Tuesday. R&D president Albert Biermann is likely to be named the new head of the division, two of the sources added, declining to be named as they are not authorized to speak to media. Hyundai is battling a plunge in sales, profits and its share price, and the reshuffle would be the latest since Hyundai promoted Euisun Chung in September to executive vice chairman, moving him closer to succeeding his octogenarian father as head of South Korea's second-largest group. The group has appointed new product strategy, design chiefs and replaced senior executives at its overseas operations, including China and the United States. The latest shake-up at the group, which includes Hyundai Motor and its affiliate Kia Motors, could be announced on Wednesday, one of the sources said. It is "part of a generational change Chung is pushing for," another person said. A Hyundai Motor spokesman declined to comment. The group's vice chairmen, Yang Woong-chul and Kwon Moon-sik, both aged 64, told senior officials on Tuesday that they would leave the company, the sources said, declining to say why they had offered to resign. Biermann, a former BMW performance vehicle development official, adds to a flurry of foreign executives that Chung, 48, has brought in to the company typically dominated by Koreans. In October, Thomas Schemera, also a former BMW executive, was appointed to lead product planning for autonomous cars, connected and electrified vehicles, while Luc Donckerwolke, a former Bentley design chief, was appointed to oversee design at Hyundai and Kia. Hyundai Motor's third-quarter net profit plunged by two-thirds, hit by U.S. recall costs that added to its problems. The automaker was already suffering with weak sales in its key U.S. and Chinese markets. Hyundai's share price is down more than 10 percent this quarter, despite a recent rebound driven by a share buyback plan announced on Nov. 30. Reporting by Hyunjoo JinRelated Video: This content is hosted by a third party. To view it, please update your privacy preferences. Manage Settings.

Kia electric concept car for Geneva displays a 21-screen salute

Kia is going to show an electric concept car at the 2019 Geneva Motor Show (we got our first look last week), and the automaker has revealed some interesting and even funny details about the car ahead of time. For starters, there will be 21(!) individual high-resolution screens in this puppy. The teaser photo of the interior is showing off a lot of them, but don't fret, there are still more in there somewhere. Kia isn't exactly serious about this kind of a setup; here's a section of the press release for you as an example: "In a humorous riposte to the industry's current obsession with ever increasing dashboard screens, the concept features 21 individual ultra high-resolution screens. These curve their synchronized way across the top of the dashboard in a layout that's at the same time both casual and coordinated." So yes, it's a joke. But it's still sort of incredible a concept like this one will exist. We don't expect 21-screen interiors to be reality anytime soon, especially when the folks who designed it agree that it's completely laughable, too. What comes next in the release is also a bit confusing. Kia says this is its first pure-electric four-door passenger car — nothing wrong there. However, it then goes on to say it combines elements from "a muscular sports utility vehicle, a sleek and athletic family saloon and a versatile and spacious crossover." SUVs and crossovers are mentioned twice there, but this is meant to be a four-door passenger car? The teaser makes it look like the concept is much more car-like than a crossover, but it could be deceiving. A hint of black cladding is shown in this side profile shot as the closest hint to its intentions of being more crossover-like. Another interesting detail here is the evolution of Kia's tiger nose grille we saw introduced on the Stinger. It looks like future Kia electric cars will have a "tiger mask" (ha) instead of a traditional flow-through grille. We dig the normal design itself on the Stinger, and the teaser itself doesn't disappoint. The car/crossover/combination thereof will be revealed in Geneva on March 5, so check back then to see the full concept. Related Video: