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Mission Accomplished, Hyundai Trade-in Guarantee Being Phased Out

Mission Accomplished, Hyundai Trade-in Guarantee Being Phased Out

By Jeff Youngs, March 08, 2012
Some might suggest that one of the reasons behind Hyundai's growth rate in the U.S. market is its ability to gauge the zeitgeist in the American automotive marketplace and respond with support programs that buyers seem to want or need. The fading of its most recent successful incentive program, a trade-in guarantee, underscores that.

The recent trade-in guarantee program followed on the heels of another Hyundai sales incentive plan designed to alleviate consumers' economic concerns. Three years ago, Hyundai used an ad in Super Bowl XLIII to launch its Hyundai Assurance incentive program. Simply put, the company would guarantee loan or lease payments for a Hyundai customer if that buyer subsequently lost his or her job. For Hyundai, making the promise--at a time when so many Americans were being affected by the Great Recession--instilled a confidence in the brand and its products.

Last spring, Hyundai tried to extend such responsiveness to the concerns of American car buyers when it launched a new program under which it agreed to future trade-in values to buyers of new Hyundai vehicles. Among other things, Hyundai was attempting to address perceptions that its residual values--how much its vehicles were worth at trade-in time--weren't keeping pace with those of the competition.

Well, the company ended that program in January, Hyundai of America President and CEO John Krafcik told Automotive News. "It did its job," Krafcik said. And indeed, Hyundai's residual values relative to the rest of the industry have continued to climb over the last year. Yet the brand continues to aspire to elevate itself to the same plateau as Toyota and Honda in the minds of American consumers.

Hyundai also is working to gain acceptance by automotive buyers for the luxury credentials of its premium models, Equus and Genesis sedans. So buyers of those two vehicles will still, for now, qualify for a trade-in guarantee.

"This is where we thought it was most important to have that message [continue]; where one might encounter more resistance to the Hyundai brand is on the premium product side," Krafcik added.
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