Hyundai weighs Europe counter-attack to outpace cautious rivals

Wed Mar 6, 2013 7:01am EST

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By Henry Foy

GENEVA, March 6 (Reuters) - Hyundai Motor Co is considering bigger investment in Europe despite a bleak demand outlook, a senior executive said on Wednesday, considering a sales push next year to boost market share as rivals tighten their belts.

Hyundai has doubled its share of Europe's car market over the past five years, but now faces an industry-wide slowdown in sales.

Yet as rivals look to cut back operations in response, the South Korean carmaker sees an opportunity.

"Yesterday we were talking about whether we should take a breather or not," Allan Rushforth, chief operating officer of Hyundai Europe, told Reuters.

"What we're considering is whether to start to put our foot down again and take advantage of the lower cost of assets, better return on investment from brand development in Europe," Rushforth said in an interview at the Geneva Motor Show.

"The question is, do we continue to consolidate or do we invest faster? Not (invest) further, because we have an investment plan for Europe," said Rushforth. "It's about timing."

Car sales fell to a 17 year low in Europe last year, and many carmakers see a gloomy economic outlook and the impact of austerity measures taken by European governments lengthening the slowdown for years.

"The die for this year is pretty much cast," said Rushforth. "But I think 2014 could possibly be the first year of recovery in the European car market."

Hyundai has outpaced industry sales growth over the past five years, taking market share from established European players such as Renault SA and Ford.

The company has recently pared back its global sales growth to focus more on improving its brand image, especially in western markets.

"We would like to get to five percent market share (in Europe)... by the end of the decade," Rushforth added. Hyundai's European market share stood at 3.6 percent last year, double its level in 2008.

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