Will Hyundai Fans Hate the Aggressive New 2014 Veloster?

2013 Veloster Turbo. Photo: Hyundai.  

The 2013, Hyundai Motor's Veloster was named the "Coolest New Car Under $18,000" by Kelly Blue Book. Too bad looks and price aren't everything. Both Edmunds and Consumer Guide gave the Veloster a less than glowing review. Consumer Guide pulled no punches:

Hyundai's own Accent is far more comfortable and enjoyable to drive. If that's not sporty enough, spend a bit more money on a Nissan Juke. I rarely say this about a car, but the Veloster should be avoided at all costs. 


More pointedly, since the Veloster was released in the U.S. in 2011, overall, monthly sales have declined year over year. So will consumers like Hyundai's aggressive new 2014 Veloster? Or is it doomed to fail? 

2013 doesn't look great
The 2013 base Veloster has a starting MSRP of $17,600 and comes with a 1.6-liter four-cylinder engine, which produces 138 hp and 132 pound-feet of torque. Further, it gets an EPA-estimated 27 mpg city, 37 mpg highway, and 31 mpg combined. Unfortunately, that's not enough to drive sales. In October, Hyundai reported that it sold 2,175 Velosters in the U.S., compared with 2,464 for the same time last year -- an 11.7% decrease. Moreover, year-to-date sales came in at 25,448, compared with 30,802 for the same time last year -- a 17.4% decrease.  

In comparison with its competitors, HondaMotor's CR-Z sold 325 units in October, compared with 244 for the same time last year -- a 33.2% increase, while BMW's Mini Cooper sold 3,145 units in October compared with 4,052 for the same time last year, a 22.4% decrease, and ToyotaMotors' Scion tC sold 1,499 units in October, compared with 1,654 for the same time last year, a 9.4% decrease.  

Can a turbo drive sales?
Overall, U.S sales of sporty hatchback and coupe-esque cars like the Veloster fell 18% in October, according to Good Car Bad Car. And the only thing that's changed about the 2014 base Veloster is daytime running lights and a backup camera. The 2014 Turbo Veloster, on the other hand, has been described as "aggressive"  and gets brake-actuated torque vectoring and an engine-sound generator, but that still may not be enough to stop the downward spiral of Vector sales. In fact, according to Veloster enthusiast dissuasion boards, waiting to buy a 2014 Turbo isn't worth it.  

What this means for investors
In the U.S., the Veloster is Hyundai's sixth best-selling vehicle, and it has seen a steady decline in sales. However, that doesn't mean it's time to throw in the Hyundai towel. According to its third-quarter results, Hyundai's global retail sales increased 7.5% compared with the same time last year, and both sales revenue and gross profit, increased. More importantly, retail sales in China increased 29.1%, and U.S sales increased 1.6%. Even better? Hyundai's stock price has gone from $32.75 a share on Nov. 1, 2012, to $56.65 a share as of this writing.

Consequently, while the Veloster may not be driving sales, and the 2014 model probably won't turn that around, Hyundai could still make a great addition to your auto-stock portfolio.

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The article Will Hyundai Fans Hate the Aggressive New 2014 Veloster? originally appeared on Fool.com.

Fool contributor Katie Spence has no position in any stocks mentioned. Follow her on Twitter: @TMFKSpence. The Motley Fool recommends BMW. Try any of our Foolish newsletter services free for 30 days. We Fools don't all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

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