Hyundai bets on AI-powered sedans to reclaim domestic market lead

Hyundai Motor is intensifying its domestic market offensive with the upcoming launch of its redesigned Grandeur and Avante sedans, both enhanced with artificial intelligence (AI) technology. This strategic move aims to solidify Hyundai's dominance against competitors, particularly Kia, which has recently gained ground with its SUV lineup.

The company will unveil the fully redesigned eighth-generation Avante at the 2026 Busan Mobility Show. This marks the first complete overhaul in six years for the popular compact sedan, which has achieved over 10 million cumulative sales in South Korea. The new model is expected to feature Hyundai's next-generation infotainment system, 'ccNC,' and a significantly revised interior, reflecting the industry's shift towards software-defined vehicles (SDVs).

This follows the recent launch of the "The New Grandeur," a partially updated model that significantly boosted its appeal with the integration of 'ccNC' and the AI-powered in-car assistant, 'Halo AI.' The Grandeur's appeal was immediate, with over 10,000 pre-orders recorded on its first day of release.

Hyundai plans to expand AI-based services across its key models, including the Sonata, accelerating its transition to SDVs. This focus on sedans comes as the domestic market sees a shift, with Kia briefly surpassing Hyundai in sales in April, driven by its popular RV models like the Sorento and Carnival. However, Hyundai regained the top spot in May, narrowly beating Kia.

Both the Grandeur and Avante are crucial high-volume sellers for Hyundai. Last year, the Avante ranked second in domestic passenger car sales, and the Grandeur fifth. Year-to-date, they hold the first and third positions respectively, with the Sonata in second, highlighting the dominance of sedans in Hyundai's domestic sales. The strategy also targets a broad customer base, with the Grandeur appealing to middle-aged and older drivers, and the Avante attracting younger buyers and first-time car purchasers.

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While the preference for SUVs continues, the Grandeur and Avante have models with 40 and 36 years of brand equity and loyal customer bases, respectively. The added effect of new models equipped with AI and SDV technology will play a significant role in strengthening Hyundai's domestic competitiveness.