Nissan, Hyundai May Gain Market Share at Toyota's Expense

SAN FRANCISCO February 3, 2003; Karen Lundegaard writing for Dow Jones reported that Nissan Motor Co. and Hyundai Motor Co. could gain the most market share of any auto franchise over the next five years, while Toyota Motor Corp. could be among the losers, according to an annual review of automotive brands by J.D. Power and Associates.

Asian and European brands fared better in the review overall, with most of their gains coming at the expense of some big domestic brands, J.D. Power predicts.

But the Power review predicted that Toyota, which has made steady market share gains in the U.S. during the past decade, could be a loser, along with General Motors Corp.'s Buick, Chevrolet, and GMC brands and Ford Motor Co.'s Ford brand. Toyota now has a full plate of vehicles from compact cars to full- size pickups, leaving it less room to grow as rapidly as it has in the past, according to Tom Libby, an executive at J.D. Power.

The Power review, based in part on information about future models, projects that Nissan will gain almost a full percentage point of U.S. market share, and Hyundai 0.79 points. For Nissan, that translates into an extra 183,000 vehicles a year in 2007, a 28% increase over 2002 levels, according to the Power forecast. For Hyundai, it means it will sell another 144,000 vehicles in 2007, a 38% increase over its 2002 volumes.

J.D. Power, a research and marketing firm based in Westlake Village, Calif., presented its findings to dealers in advance of their annual dealer conference here. The company based its predictions on monthly forecasts of vehicles sales, surveys of new car buyers, its own research of upcoming vehicles and daily auto sales transactions from more than 5,000 franchises nationwide.

Nissan's gains will come from entering several new vehicle segments, with launches later this year of a full-size sport utility and a full-size pickup the Titan, according to J.D. Power. The company also launched late last year its first smaller SUV, the Murano, and in the 2005 model year plans an entry-level compact car, the March, that it already sells in Japan.

Hyundai's gains will come from getting into the midsize SUV market in the 2005 model year and a minivan the following year.

The Power review predicts that GM's Saturn brand will increase its share by a 0.65 percentage point with help from launches of a new minivan, a midsize SUV and a vehicle that is half SUV and half pickup truck, J.D. Power predicts. Rounding out the top five are Volkswagen, which Power expects to increase market share with help from its first SUV, due later this year, another lower-priced SUV in the 2006 model year and a luxury car, the Phaeton.

Jeep should gain a 0.5 percentage point from adding two new models in existing segments in model year 2006 and replacements for its current trio of products, Grand Cherokee, Wrangler and Liberty, the Power review predicts.