Hyundai CEO: 80% of Cars Bought Here Will Be Built Here
Hyundai CEO John Krafcik told CNNMoney yesterday he expects four out of every five Hyundai models sold in the U.S. to be built here by the end of next year. That includes the redesigned Elantra, which is slated to move to the automaker's Montgomery, Ala., plant from its current production in Korea; this would put Hyundai atop the automotive pile in terms of the percentage of cars bought here that are built here, CNNMoney reports.
That's not to say Hyundai's U.S. footprint eclipses the Detroit Three.
Still, it's good to see Hyundai building cars here, if primarily to facilitate nimbler supply lines and hedge against currency fluctuations. So, why are both models' domestic parts content — 41% for the 2011 Sonata and 40% for the 2010 Santa Fe — so low? Neither one is eligible for inclusion in Cars.com's annual American-Made Index, which rates vehicles built and bought in the U.S. For the index, we look at a car’s sales, where its parts come from and whether the car is assembled in the U.S. We set the domestic parts content minimum at 75 percent.
Burns concedes the numbers are low, but said it's likely to improve since Hyundai began installing transmissions several months ago from a plant at the West Point facility. Engines for the Santa Fe and non-hybrid Sonata already come from the U.S., in this case an engine plant on the Montgomery site.
"A lot of the smaller electronic components will come from Korea," Burns said. "But your seats, headliners, bumper fascias ... front-end assemblies, the radiator and lights are all made in the good old U.S.A. [Domestic parts content is] slowly but surely easing its way up."
Slowly indeed: The Sonata's domestic parts content increased 1% from 2010 to 2011. We'll have to wait until new domestic parts content figures arrive for 2012 to see if Hyundai’s numbers rise any higher. In the meantime, both cars — plus the Elantra — will have a long way to go to hit 75%.