* New model effects to be maximized

Strong sales continued in February

February sales continued their winning streak with a healthy 462,467 units (+31.8% YoY), led by robust domestic sales (106,522, +21.2% YoY) and strong overseas plant sales (184,199, +65.2% YoY). As the YF Sonata will begin full-scale sales in March, the expansion of Hyundai Motor (Hyundai) and Kia Motors’ (Kia) US market share should soon resume. Kia posted a higher sales growth rate (138,811, +45.5% YoY, vs. Hyundai’s +23.4% YoY) on the back of sound domestic (+21.6% YoY) and overseas plant sales (50,402, +172.3% YoY). Kia sold 24,002 units (+128.5% YoY) in China in February, bringing its 2M10 sales to 58,192 units (+183.7% YoY). Kia’s K7 and Sorento R sold 4,249 and 4,068 units in Korea.

Complaints over Toyota’s recalled vehicles mounting

Hyundai’s US market share remained at 4.4% but Kia’s slipped to 3.1% from 3.2% a year earlier. Meanwhile, Toyota’s market share continued its downward spiral to 12.8% from 15.9% a year earlier and 14.1% in January. Toyota is struggling to restore its badly tarnished brand image, suffering three days of testimony before the US Congress on Feb 23, 24 and Mar 2. However, the beleaguered Japanese automaker problems with Washington appear to be far from over as it facing another congressional hearing on Mar 11 amid a growing chorus of complaints from Toyota owners whose vehicles have been recalled and supposedly repaired. In contrast, after running advertisements during the Super Bowl for three consecutive years, Hyundai aired eight commercials during the Academy Awards as the event's exclusive automotive sponsor for the second straight year. As these two TV spots were focused on the YF (five spots out of eight during the Super Bowl, six out of eight during the Oscars), the new car effect should be maximized from March, we believe.