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Reflecting on Hyundai Canada’s 2024 Banner Year with Don Romano

Autosphere » Dealerships » Reflecting on Hyundai Canada’s 2024 Banner Year with Don Romano
Don Romano, President & CEO, Hyundai Canada. Credit: Hyundai Canada

A record year in sales is the culmination of investments made a decade ago.

In 2024, Hyundai Canada, reported banner year sales for both its Hyundai and Genesis brands. For the first time, volumes surpassed that of Honda and Acura. Hyundai reported a total of 131,715 units sold for the year, representing a 13.9% year over year increase. Meanwhile Genesis sold 7,040 units in Canada during 2024 through its 31 distributor locations. This represents a 6.4% increase over 2023 and the luxury brand’s highest volumes to date in its eight-year history in Canada.

Genesis GV70 has proven to be a big hit with consumers in Canada. Credit: Hyundai Motor America

Surge in EV demand

Additionally, Hyundai also witnessed 45,159 electric vehicle deliveries during 2024, an impressive total by all accounts, and representing a 35.1% year over year increase.

So, what’s the magic behind Hyundai and Genesis’ success over the last 12 months, particularly in an environment where high cost of living and economic uncertainty is weighing on the minds of many. To find that out, Autosphere sat down with Hyundai Canada President and CEO Don Romano. 

Performance oriented N brand extends to battery electric vehicles, the first to launch being the IONIQ 5 N. Credit: Hyundai Motor America

Autosphere: What do you think were some of the contributing factors that enabled both brands to achieve such outstanding sales results, especially given the current economic environment?

Don Romano: As we’ve seen with the numbers, a good deal of our success last year came from EV sales, which at 45,159 units represented 70% of our increase in volume over 2023. As a brand, Hyundai was an early adopter in the EV space, and we continue to develop and advance in this area. While there have been a lot of news and media reports about the decline in EV demand, certainly for us at Hyundai, we’re seeing the opposite. While incremental and marginal growth for EVs has declined, overall volumes and total growth is still trending upward. For the Hyundai brand, we increased our sales by16,000 units last year, and 11,000 of that was from EVs. I think a big part of that was having a wide variety of EVs available to consumers, essentially having something for every segment and every buyer. When we look at total volume for the Hyundai brand, we’ve also seen a steady introduction of new products, including the new Santa Fe and redesigned Tucson. These have made a big contribution, and I think that’s reflected in the fact that in this industry, product is still king. Yet the real key to success lies with combining the right product with the right dealers.

AS: Can you tell us a little more about that?

DR: There’s no question that our dealers have been a major part in our success. They’ve already been spending over a $1 billion in upgrading their facilities and we’re seeing those investments continue, including a new store in Yorkdale, Ontario, just off the 401. Our dealers have really gone all out and 30 of them have taken on the Genesis program and that’s doing well. So, if I were to sum it up in a nutshell, I would say our success comes down to the commitment of our dealers, coupled with great product.

AS: Focusing on Genesis specifically, what do you think about the brand is really resonating with consumers?

DR: With Genesis, the goal is premium customer service. When we established the brand in Canada, we were the first to go with an agency retail model in North America, for the explicit reason that we wanted to have the best customer service in the industry. Today, eight years later, we are at the #2 spot in customer service and have the opportunity to become #1. From the outset, our goal was to change the mindset of how automotive brands and by extension, their brand retail stores deal with customers, and so when it came to Genesis, we approached things differently from both the sales and the service side. New facilities that were designed for a much more high-end experience, but more importantly, it was the dealer mindset that went along with that. We flew our dealers to France. We worked with Forbes Travel to talk about what it’s like to deal with customers at a luxury level. With Genesis, and through the agency model it’s not about volume, but service, When you purchase the vehicle, including online, the price is set, but the price includes everything, so we want to take care of the customer’s every need, knowing that while they paid the price that we set, [which is still competitive relative to who we go against in the marketplace], the end goal it was making sure that at Genesis locations, we offer the epitome of customer service.

AS: When building this model, you decided to stick with existing Hyundai dealers, can you tell us a little about that?

DR: Instead of looking for luxury dealers outside our network, when it came to Genesis, we said, that we were going to work with our existing Hyundai dealers and that they were now going to become luxury retailers. And they went all in and have done a tremendous job for us. Today, we’re witnessing the growth we’ve planned, and we’ll take it, watch it, and watch it again. For us, it’s about having consistent growth, not trying to force the market. We’re proud of the products we manufacture, and we’re proud of the service we deliver, and we’re proud of our pricing. So, we put that all together with the goal of giving people a great experience for giving their time back to us. We didn’t want our customers sitting in an F&I office for hours or haggling over the price three or four times before the deal is closed. On the service side, we also emphasize valuing the customer’s time and we will pick up the vehicle for service and deliver it back to them if they want or provide a loaner vehicle. Or, if they prefer to bring their vehicle and wait for service, we will do that too. It’s been a great journey for us because it has allowed us to learn about our customers and upgrade the experience across the dealer network.  

AS: When we look specifically at product on the Genesis side, what do you feel has proved particularly appealing about the GV70 and GV80 among Canadians?

DR: Well, I feel the first thing is design. Both the GV70 and GV80 have attractive, distinctive styling that captures attention. The second thing would be the interior appointments, including the attention to detail and materials throughout. I think that’s a big selling point today, especially when dealership staff, whether it’s a product specialist or even a general manager can really show these aspects to the customer. I also feel that these two models reflect where the luxury market is going. It’s one segment that hasn’t been performing that well in recent years, but if you can offer a distinctive vehicle that’s well equipped, competitively priced and provides features that a customer wants, and then combine that with a buying and ownership experience that’s a cut above, then you’ll likely do well in the market, no matter whether things are up or down. With the GV70 and GV80, one feature that’s really helped has been the introduction of three-row seating which has added to their versatility and appeal among buyers.

AS: From a retail perspective and referring to Genesis, given its unique retail model, what do you feel is key in having such strong, consistent demand?

DR: In this industry, as we’ve seen, anything is subject to change, and we will see the market continue to evolve. We’ve had a good deal of success with the agency retail model for Genesis, but that’s not to say we will always be an agency model. As you grow as a brand, there is a point where you can outgrow an agency model, but I will also say I don’t believe a direct sales approach is the way forward. Our dealers are fundamental to our success as a brand, because they’re not just in the communities they operate, they are part of them, and they know their customers and the automotive retail business better than anyone. Today, Genesis dealers provide the best possible representation you could ask for, though it’s important to understand that whether they operate via an agency or franchise model is not necessarily conducive to their success. I will say that if we grow by very significant volumes, it will become more difficult to maintain the agency model, but that would be a decision we make collectively with our Genesis distributors. We are tied at the hip on this venture, which is now eight years old, and we’ve been in lock step all the way. Currently, things are going well, we are seeing the growth we envisioned, and the retail model is working well.

AS: Looking at Hyundai, what do you think has been a key part of the brand’s success in this marketplace – particularly in growing sales in 2024 over the previous year, in what has been a challenging environment for many in the industry?

DR: In order to understand this, we need to go back to 10 years ago, and some of the actions we took then. This was a time, where we had to make some very tough decisions. Our dealers didn’t like us and frequently we were told we were the worst franchise to deal with because of those decisions we had to make. We went across the country, starting in Victoria, B.C. We had round table discussions—no presentations—just essentially circles where we would listen to the concerns of our dealers and show them where we were going as a brand. Even back then, we talked about the emergence of brands from China and from India. We said to them that a tsunami in new competition was coming and that if we weren’t prepared and made the right investments, alongside our dealers, we could be washed away. After having a series of tough meetings, our dealers agreed, and we began to invest for the future. First came the facility upgrades, which began in Quebec with others following suit. Along with the facility upgrades came a change in mindset, and then followed new product, which led to profitability and then the volume. There will always be challenges in this business, but today, we are in a position, where we have established a reputation for quality and for customer experience, and when new competitors do arrive, that’s something that’s going to take them a long time to develop. The steps we took a decade ago have also changed the perception of Hyundai as a brand. Where once it was viewed as an entry-level offering, today, it’s an aspirational brand where consumers gravitate toward vehicles like the Santa Fe, Tucson, and where we have an option in everything from ICE, to Hybrids, to PHEVs and Battery Electric Vehicles.

AS: Are there any particular aspects to the product lineup or features that you feel is really resonating with consumers at present?

DR: I would say our N performance brand. As we’ve moved up, we’ve focused more on pushing performance both on the street and on the racetrack. When you’re building a halo brand like this, you must prove you have the technology to compete and have the best engineers to deliver the best performance vehicles in the market. We’ve seen this time and again with established and luxury brands and the relationship that develops by having that performance arm. It’s not enough to be able to build fast cars, you must go out there and earn that reputation. Mark Wilkins Racing has done a wonderful job in helping us establish N as a true performance and competition brand, and we will continue to evolve it in every aspect of our lineup. We see N as a real opportunity to grow the overall Hyundai brand.     

AS: How do you feel Hyundai is positioned within the EV marketplace, especially around three core products such as the IONIQ 5, Tucson HEV and KONA Electric and especially given the sales volumes you’ve been witnessing recently?

DR: Hyundai was an early adopter when it came to EVs and believed they represented the future. We still do today, and I think learning the ins and outs of the differences between customers, the product and the driving experience was key. Taking that, learning it, and applying it to the next generation of vehicles is what has put us into a leadership position today when it comes to EVs, for vehicles like the KONA EV, IONIQ 5 and IONIQ 6. Yes, the market has changed, and while some competitors have cut back or abandoned EV production for now, we continue to push forward. We’ve been ramping up our new EV facility in Georgia for both vehicle and battery production, but if we hadn’t taken those steps early on, we wouldn’t be in a position where 70% of Hyundai’s annual sales growth in 2024 was due to EVs. The EV will have its ups and downs, but overall, demand is continuing to grow. If there is one thing we’ve learned, it is that when it comes to EVs, you need to ensure they appeal to as broad a range of customers as possible. Some will embrace the technology, while others will want them to behave essentially like an ICE vehicle and feature controls that are familiar. That’s especially true for older buyers who don’t want to go through the trial and error of having to try to operate nearly all functions via a touch screen. It comes back to understanding your customers and we have and will continue applying that to the next generation of EVs we will introduce. We’ve made a long-term commitment to EVs and for us, there’s no turning back.

AS: With consumers still having very different views on EVs, from a retail perspective what do you think is essential for a smooth and rewarding customer experience?

DR: I think there is still a lot to learn. On the retail side, we’ve had some dealers that are exceptional and have made the investments and training necessary to deliver an outstanding EV retail experience, while others are still looking at the short term and seeing that it’s still much easier to sell ICE and hybrid vehicles than it is true EVs. Where that can present challenges is when a customer comes into the store and they’re interested in an EV, but the retail location is not prepared to properly address that interest. Fortunately, we’re seeing more and more dealers investing in EVs with the right training and the right tools. The key to making it all work long-term however, is consistency. You’re going to be in a situation where one customer wants a regular KONA with an internal combustion engine, and another wants a KONA EV. As a retailer, you need to be prepared to cater to these two very different clients and that requires training and learning specifically what their needs are. Yes, it is a challenge to sell EVs, particularly over the short and possibly medium term, but it’s the long-term trend where it will really pay off and that’s something we’ve been focused on since day one. 

Categories : Dealerships, Editorial
Tags : Hyundai

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