Hyundai Motor ranked a poor 14th among 26 brands assessed in Top Picks 2013 released on Tuesday by U.S. magazine Consumer Reports. Its ranking slid three notches from last year's 11th and put it even behind affiliate Kia, which came 11th this year.
A few weeks ago, Hyundai also ranked below average in both the Initial Quality Study and the Vehicle Dependability Study by J.D. Power, an American market researcher.
The U.S. is the world's second largest auto market where about 40 automakers compete. With Hyundai's rating falling sharply in these two highly respected surveys, many experts worry that it is facing a crisis there.
◆ Japanese Comeback
The U.S. press hailed a "perfect victory" for Japanese cars in the Consumer Report ranking because they finished first through seventh.
Consumer Reports assessed each model of each automaker this year, and three Toyotas grabbed top spots, with the luxury Lexus sedan ranking first and the compact Scion sixth.
Japanese automakers have recently released new models with improved innovative features, which helped them overcome their own crisis. Japanese cars were rated poorly after massive recalls of Toyotas in 2009 and production bottlenecks after the earthquake in 2011.
Hyundai, by contrast, finished on a par with Cadillac in the Consumer Reports ranking with a total score of 63 points, a little below the average.
The Hyundai Elantra (Avante in the Korean market) was the best budget car model of the year, but the firm's SUVs and luxury sedans lagged far behind their rivals from Japan and Germany.
A Hyundai executive said, "It's not that the absolute value of our cars dropped in various recent reviews; they merely dropped in the rankings because Japanese automakers have done well."
◆ German Cars
But Japanese cars are not the only threat to Hyundai in the American market. Volkswagen, which built its U.S. plant later than Hyundai, is right on the Korean carmaker’s heels in the Consumer Reports survey with only a single point between them.
The magazine chose the Audi A6 as the best luxury car and the BMW 328i as the best sports sedan, the first time Audi and BMWs have even been listed.
Sales of Hyundai and Kia rose a mere 2 percent in the U.S. in January and their market share fell to 7.7 percent.
Lee Hang-koo at the Korea Institute for Industrial Economics and Trade said, "Hyundai cars were favorably received over the past years for their good quality despite lower prices than Japanese cars," but now the positions have been reversed.
The new Honda Accord, which was released last year, consumes 3 mpg (1.3 km/L) less fuel in urban areas than the Hyundai Sonata and has far more luxurious interior and exterior designs.