November 27, 2024

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[THE INVESTOR] South Korea’s largest automaker Hyundai Motor will begin production of its new compact sport utility vehicle, which is widely rumored to be named “Kona,” from June 15, according to news reports on Feb. 22.

The new car, whose project name is “OS,” will be produced at Hyundai’s Ulsan plant where compact cars Accent and Veloster are being manufactured. Following the market debut in May, the automaker plans to take preorders for a month and deliver the cars to the customers in June.

Since January, Hyundai has started a 220 billion won (US$192.66 million) construction to add a new assembly line to build its new compact SUV at its Ulsan plant. 

The design of the new SUV is based on Hyundai Motor’s Intrado concept car unveiled at the 2014 Geneva Motor Show.

The Kona will likely come in three different engine types -- 1.4-liter gasoline turbo, 1.4-liter diesel and 1.6-liter diesel. An electric model is also under development, according to sources.

The automaker has set an ambitious hope of selling 45,000 units every year.

The name Kona comes from a district in Hawaii famous for coffee beans. The name, however, is subject to change, some sources said.

It is not the first time the nation’s largest auto group used area names around the world for its SUV vehicles, including Santa Fe, Tucson and Kia Motors’ Mohave.

The automaker will sell the car in Korea first, and then possibly introduce it in other developed countries, including the US and Europe, as part of Hyundai’s all-out effort to strengthen its SUV vehicle lineup. The carmaker has already introduced compact SUV Creta, sold as ix25 in China, in some emerging markets, including India and Russia.

The new SUV entry is expected to heat up competition in the compact market on home turf, vying with Ssangyong Motor’s Tivoli, Renault Samsung’s QM3 and GM Korea’s Chevrolet Trax. Tivoli topped the segment, selling 28,886 units last year.

According to data released by the Hyundai Motor Group Automobile Industry Research Center, SUV is one of the fastest-growing automotive segments, recording a 9.8 percent yearly growth rate in the past 10 years here.

Notably, compact SUV is thriving rapidly, which is expected to account for 19 percent of the total SUV market by 2020, up from the current 10 percent.

By Ahn Sung-mi (sahn@heraldcorp.com)