Hyundai Seeks to Plug SUV Gap

Hyundai Motor, whose sedan-heavy lineup has held it back in a U.S. market powered by sport utility vehicles, is considering developing larger SUVs based on its Genesis luxury sedan, four people familiar with the matter told Reuters.

However, it could take two or three years for the vehicle to go on sale and the South Korean firm’s poor track record with bigger SUVs, and its lack of pickup trucks, underscore the challenges in cracking the high-margin market for utility vehicles dominated by U.S. and Japanese rivals.

“We are timid when it comes to bigger SUVs,” said the person familiar with Hyundai’s vehicle development who did not want to be named as he is not authorized to speak to the media.

The automaker is considering an internal proposal made last year to develop Genesis-based SUVs to fill a gap at the high end of its SUV range, said a second person with knowledge of the matter. The aim would be to plug into the appeal of the Genesis to elevate Hyundai’s overall brand image.

At the end of next month, Hyundai will halt production of its biggest SUV, the Veracruz, according to the newspaper published by its South Korean labor union. Last year, Hyundai sold fewer than 5,000 of its Veracruz, all in South Korea, compared with 54,325 globally in 2007.

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