Hyundai Motor eyes U.S. truck market, Chrysler tie-up

Hyundai Motor Co has floated plans to enter the high-stakes U.S. pickup truck market and proposed a partnership with Chrysler Group LLC, three people with knowledge of the process said.

As one option, Hyundai made a proposal to Chrysler earlier this year under which the U.S. automaker would build a truck for Hyundai based on Chrysler's Ram truck platform, according to two of the sources.

Such a tie-up would take the place of a now-scuttled alliance between Chrysler and Nissan Motor Co Ltd and could allow Chrysler to expand production and reduce costs for Ram, the No. 3 ranking pickup truck brand by sales.

Chrysler Chief Executive Sergio Marchionne rebuffed Hyundai's initial approach in February, according to the sources, saying the automaker needs to focus on its established turnaround plans under Fiat SpA.

But Hyundai continues to look at truck options and could come back to Chrysler, according to two of those with knowledge of the talks, who were not authorized to discuss the matter because the closed-door discussions were preliminary.

"We never say never; however, at this stage, pickup trucks are not high on our priority list," Hyundai Motor America spokesman Dan Bedore said.

Chrysler spokesman Gualberto Ranieri had no comment.

The quiet contacts between Hyundai and Chrysler this year underscore both the growth ambitions of the South Korean automaker and the nagging doubts over whether Chrysler will undergo a further transformation a year after its restructuring in a U.S.-government funded bankruptcy proceeding, analysts say.

For Hyundai, entering the U.S. pickup truck market would mean a bet on a high-margin but fiercely competitive segment where both Nissan and Toyota Motor Corp (7203.T) have failed to break the dominance of Detroit automakers.