New curves, good value drive Hyundai's China sales

China is falling in love with Hyundai Motor.

The South Korean company has accelerated to become the maker of the top selling foreign car brand in the world's largest auto market today from virtually nothing just seven years ago.

Its rapid rise in China, one of the few bright spots in a global auto market mired in red ink, parallels its broader move into the fast lane on its growing reputation as a solid value proposition in troubled economic times.

Clever marketing, including a new model whose name sounds like "falling in love with you" in Chinese, plus cash incentives under Beijing's massive economic stimulus plan haven't hurt, either.

China passed the United States in January to become the world's largest auto market, on track to sell a record 13 million vehicles this year, even as sales in other markets around the globe tumble.

Hyundai has found a comfortable niche for itself in the market between domestic brands known for their cheap prices and foreign brands such as Volkswagen and Toyota, known for their quality but also higher prices.

"Hyundai is somewhere in between. It's more expensive than Chinese brands and cheaper than other global brands, but still delivers a relatively high level of quality," said Klaus Paur, director for global industry consultancy TNS's North Asia automotive division.

"That's what makes Korean cars so successful especially in the segment where consumers get government incentives."

Ironically, the image that has served it well had some analysts predicting only a few years ago that Hyundai would be the first to be squeezed out as Chinese start-ups raise their quality and offer lower prices.

Lin Jian, a 32-year-old Chinese engineer, and his wife were just two of the thousands of Chinese who have propelled Hyundai's new Elantra to China's best selling foreign car brand this year.

"The new Elantra has a sleek exterior but not over the top. And it feels good on the road," said Lin, pulling over after test driving a silver Elantra near a dealership in suburban Shanghai on a recent fall day. "Most of all, it's value for money."

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