The rapid rise of Korean automakers

Talk to anyone in the auto industry these days, and you’ll hear that these are unprecedented, awful times. Unless, that is, you happen to be speaking to someone who works for a Korean automaker.

“Everything’s normal,” said Kia spokesperson Alex Fedorak at a recent press event for the new Soul. He went on to explain that Kia sales have dropped only about 10 percent this year, and that Kia’s future product plans, including the Forte and the Amanti, have not changed.

At the New York auto show, Kia’s part owner, Hyundai, whistled the same tune, celebrating flat sales along with a rapid-fire rollout of products over the past year that’s seen two powerful rear-wheel-drive vehicles and a Euro-tuned wagon enter its lineup.

Even GM Daewoo is doing well – or at least as well as can be expected given its parent company. The Chevrolet Cruze, designed mostly in Daewoo studios, is launching worldwide, and more Korea-based small cars, including the Chevy Spark and the next Aveo, are on their way.

To some degree, the professed success of the Korean automakers is corporate spin (Kia and Hyundai have partially propped up sales by pulling ahead fleet orders), but there’s no doubt they are on the offensive in a time when most companies are tightening their belts.

“Hyundai/Kia is the only volume automaker that views this crisis as an opportunity, and it’s the only one acting aggressively,”; auto industry analyst John Casesa recently told us.;

The ascendancy of Korea’s automakers was probably only a matter of time. After all, they’ve been selling cars here for more than twenty years. But the improvement in their products of late has been very noticeable, moving from disposable cars (we’ve actually used that term in our magazine) to stuff we actually care about. That it’s happening as the rest of the market contracts into a heap of canceled products and shuttered plants makes their newfound assertiveness all the more significant.

If these products fail, Korean automakers could soon develop the same cash-flow problems that are hurting the rest of the industry. If they succeed and gain share, they could emerge from this crisis with a much bigger piece of the U.S. auto market than anyone had anticipated.