A relative newcomer in the United States auto market, Hyundai has come a long way since its arrival in 1986. At its North American debut, the brand offered a single model, the budget-oriented Excel. Now, Hyundai offers 13 different models, including two crossovers and three luxury cars, and in 2014 the company sold 725,718 vehicles, or about 4.4 percent of the U.S. market.
Mike O'Brien, Hyundai's vice president of corporate and product planning, sat down with us at the New York International Auto Show to talk about where the brand is headed in the future. Technology to make cars safer and more efficient is advancing rapidly across the industry, and O'Brien said that Hyundai's goal is to stay ahead of the curve.
AWN: Gas prices have been low recently, leading some people to speculate that Americans will regain their affinity for big gas guzzlers. Has this thinking had any impact on Hyundai's product planning?
MO'B: Irrespective of current gas prices, regulation and a global awareness that we need to reduce carbon emissions have changed things. We're not an energy company, but it appears that low-priced gas is not going to be a longterm thing. We're planning on increased demand for vehicles with higher fuel economy, and we've stated clearly that we will beat the Obama standard of 50 mpg by 2025.
AWN: How is Hyundai reducing its fleet emissions and improving fuel economy?
MO'B: One of the ways is with hydrogen fuel. We launched our hydrogen fuel cell vehicle in 2014, and we've delivered nearly 70 now. Customers want something that doesn't require compromise, and hydrogen does everything gasoline does in terms of range and cold weather operability. One of the things you read about our hydrogen fuel CUV is that it's a very unremarkable vehicle - it drives just like a gasoline-powered Tucson.
Our only limitation right now is the number of hydrogen fueling stations available. We need help from the government so that we can have stations outside of Southern California. (California) Governor Jerry Brown set aside $200 million for independent investors who want to build hydrogen filling stations, and we're hoping to see more of those incentives.
AWN: What about battery-electric vehicles?
MO'B: Sure, battery-powered vehicles may have an important role. But they will only be part of the zero emissions solution. Probably the biggest single advantage of hydrogen power is that it can be scaled to any size of vehicle - cars, trucks, buses and so on. Battery power will be reserved for smaller vehicles - although there may be a breakthrough in battery technology. But right now, it has limitations.
We're big supporters of hydrogen fuel. It could be a homegrown energy source. The University of California, Irvine's National Fuel Research Center is http://news.uci.edu/features/uci-scientists-convert-sewage-into-eco-friendly-fuel/ using human waste to create hydrogen fuel. Some of the hydrogen is for motor fuel, and most of it supplies electricity for the sanitary plant. This process is like finding money on the ground; it's something for nothing.
AWN: How is Hyundai facing the wave of new safety technology? Are autonomous vehicles in the brand's future?
MO'B: We've been quiet about it, but we've been in the same room with other manufacturers in discussions about car-to-car and car-to-ground communication standards. It will basically entail putting another modem in each car, but that's a ways off. In the meantime, there are levels of autonomy that will appear as individual safety features. For example, lane keep assist, which keeps the vehicle between highway lane lines automatically, and fully automatic emergency braking are available on a few of our vehicles.
AWN: Does Hyundai have plans to make those standard features?
MO'B: Right now, they're optional, but we can make them available any way our customers ask. So far, it's all based on customer input. We've pushed really hard to make automatic braking available across our model lineup. That feature is going to be as important as airbags in terms of preventing injuries.
We're also very excited by Android Auto and Apple Car Play coming online because they'll help remove driver distraction. We already have a feature that blacks out the screen of your phone when you attach a cable tether to the car's USB port. It takes all of your phone's functions and puts them on the car's screen.
AWN: It seems that regardless of fuel prices, Americans love trucks. Was Hyundai serious about the Santa Cruz concept?
MO'B: There's been tremendous global interest in the Santa Cruz. We have no expectation to attract customers who have owned a pickup truck, but there are a lot of CUV owners who want a smaller vehicle with open bed space in the back for bikes and kayaks and other recreational gear. A lot of Millennials are moving to urban areas, and want a vehicle that will fit in a smaller space, but still has utility. That's how a lot of people have been drawn to CUVs. I'm sort of quoting Jay Leno here, but a lot of CUV owners are like Denny's customers. Nobody goes to Denny's, they just sort of end up there.
AWN: There have been a number of other pickup-ish car models over the years, but they haven't always been successful. If it goes into production, how will the Santa Cruz be different?
MO'B: Every other similar vehicle had one or two fatal flaws. Either the price was too high relative to the product or there were too many design compromises. If you look at the Subaru Baja, the rear axle was placed in front of the bed - many customers didn't know how to express it, but the weight balance was off. In a pickup truck, the bed is centered over the rear axle.
AWN: What are Hyundai's major challenges?
MO'B: Virtually all the growth last year came in the truck segment, as the US EPA defines it. That includes CUVs, minivans and pickups. Cars didn't grow too much. That's been a challenge for us, because we've been more of a car company. I think that when people see higher ground clearance and bigger wheels, they see the product as more durable.
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