• by Thom Forbes , June 8, 2017

With Hyundai sales in the U.S. plunging 15.5% last month over the previous year, its VP of sales, Derrick Hatami, is leaving the company “for a position outside the company,” the South Korean automaker said yesterday from its regional headquarters in Fountain Valley, Calif.

“Hyundai has struggled to maintain sales momentum in recent years, dogged by its heavy reliance on sedans, which have been losing ground to sport utility vehicles,” writes Reuters’ Hyunjoo Jin.

“Hyundai's top U.S. executive, Dave Zuchowski, quit in December. Hyundai also replaced its sales chief in South Korea and its China head last year after the company, along with affiliate Kia Motors, posted its first annual global sales fall in nearly two decades,” Hyunjoo continues.

“Zuchowski, president and CEO of Hyundai Motor America, resigned amid rumors that the carmaker was holding him responsible for stalled sales growth in the U.S. market,” Cho Chung-un writes for The Korea Herald.

The automaker was the worst performance of any manufacturer in an overall market that showed some resiliency in May thanks to heavy discounting, including Hyundai’s “unheard of” offer of $6,750 cash back on its mid-sized Sonata sedan, as contributor David Kiley reported for Forbes. 

But the headline on a June 1 blog post by Michael Stewart, senior group manager, corporate & marketing PR for Hyundai Motor America, accentuated the positive. “BEST TUCSON MONTH OF ALL TIME,” it told us. The 10,600 compact SUVs sold represented a 44% year-over increase.

But elsewhere, it’s not so sunny.

Hyundai “has failed to keep pace with Americans' changing tastes over the past several years toward crossover wagons and larger sport-utility vehicles amid a run of low gasoline prices, said Adam Kraushaar, who chaired Hyundai's National Dealer Council until the end of 2016,” Adrienne Roberts reports for MarketWatch.

“The automaker has also been selling too many vehicles to fleet customers such as rental-car agencies, a move that can ding residual values, Mr. Kraushaar said. ‘There's some instability at Hyundai and it's concerning,’ he said in an interview,” Roberts continues.

There was no immediate word on where Hatami was heading. He “briefly worked for Nissan from 2014 to 2015 in between a decade-long career at Hyundai,” Kinsey Grant writes for The Street.  

“Hyundai said it would begin a search for Hatami's successor immediately. In the interim, it said, Sam Brnovich, Hyundai's southern regional general manager, “will support the overall sales organization,” David Undercoffler writes for Automotive News, which had selected Hatami as a “rising star” last year.

“Hatami has been climbing the ranks since 2000, when he earned an MBA from the Massachusetts Institute of Technology,” Gabe Nelson wrote in a short profile at the time. “He began in consulting, working at Accenture and J.D. Power & and Associates before joining Hyundai in 2005 as director of revenue management and strategic planning. In that job he was in charge of pricing, incentives and market research.

“Five years later, Hatami was asked to merge California and Western sales. He was general manager of the combined regions from 2010 through the end of 2013,” Nelson continues.

“Derrick served the company well during his time as head of sales and we wish him nothing but success,” Hyundai said yesterday in a statement to Automotive News.

In other news in another key market, Hyundai announced yesterday that it is hiring Simon Loasby, director of design for Volkswagen China, as VP and executive director of Hyundai China Design, Jung Min-hee reports for Business Korea. Loasby began his career as a designer at Rolls-Royce and Bentley in 1991 after studying mechanical engineering at the College of London and receiving his MA degree from the Royal College of Art and Design.

Hyundai also announced a partnership to develop connected cars with Baidu, China’s largest Internet service provider, at the Consumer Electronics Show (CES) Asia in Shanghai. It will be installing the Baidu MapAuto navigation system and the Duer OS Auto artificial intelligence (AI) personal assistant in vehicles such as the Santa Fe SUV on display.

“The Baidu MapAuto provides not only a navigation service but also useful information for the driver such as traffic congestion, famous restaurants and tourist attractions in real time through processing big data from the Internet. It also synchronizes with a smartphone to download useful information to provide a customized driver interface in the car,” Jhoo Dong-chan reports for The Korea Times. “Duer OS Auto is an AI assistant with a voice recognition system for cars.”

If only the two could combine to tell it how to find its way back to growing sales.

CORRECTION: This article has been modified from an earlier version to clarify that the 44% jump in May sales was for the Tucson compact SUV, not the market.