Big future for small utes

Hyundai’s new compact dual-cab ute, the Santa Cruz, could become as popular as its Tucson SUV stablemate in the USA. That’s the opinion of Hyundai Motor America Vice President of Corporate and Product Planning, Mike O’Brien.

The SUV-based Santa Cruz was unveiled in concept form at last year’s Detroit motor show and all but confirmed for production this week by Hyundai US execs.

Insiders say the research program behind the vehicle was one of the most extensive the company has ever undertaken. According to O’Brien, the man in charge of short- and long-term product planning for Hyundai’s US operations, the study’s findings confirmed there is “significant” demand for the vehicle.

“We did a ton of research on the project... Some people just need the utility of an open bed; and what we found out is that there’s a big market [proportion] of people that are buying CUVs [crossover utility vehicles, Hyundai’s term for SUVs] but it’s not their first choice.

“They’re married, have one or two kids. They kayak, they mountain bike, they rock climb… They hate the idea that they put their dirty gear in the back of their CUV, right where the child seat’s going to go Monday morning,” O’Brien stated.

“At the same time, they seek something that works with their urban lifestyle, that’s easy to part, easy to store, gets better fuel economy [than conventional pick-ups]… And they want something with a sportier image,” he revealed.

O’Brien also suggest a large proportion of potential Santa Cruz buyers will be female – in contrast to ‘conventional’ utes

“Santa Cruz, I really believe like the [Honda] CR-V [and Toyota RAV4 and the like which debuted] in 1996 will fill a market need that is unmet at the moment,” he told motoring.com.au.

Although not official confirmed for production, HMA boss Dave Zuchowski told Australian media this week that the Tucson-based ute was now a ‘when, not if’ proposition. What is not determined is where the Santa Cruz will be built and whether it will be produced in right-hand drive for markets like Australia.

“It’s unclear, honestly,” O’Brien stated.

“It’s probably likely it will be produced here [in Hyundai’s Alabama plant]. There’s not a concrete [production] plan.”

Nor is clear whether Santa Cruz will be followed by other pick-up products from Hyundai. While the Korean manufacturer has ruled out a US-style full-size truck (think Ford F-150), a smaller rival for the Toyota HiLux has some attraction to it, concedes O’Brien

“We have to start somewhere and no decision’s been made [on other vehicles]. We haven’t gone past the current [Santa Cruz] project,” he said.

“I think it [Santa Cruz] has the potential to be a really good volume area of the market. It’s one of those vehicles that does everything. Everything that a small CUV does and it does something extra.”

Santa Cruz will likely productionise a number of the innovations the concept featured. O’Brien said both the showcar’s roll-up hard tonneau cover and 'LazyBoy' tailgate/bed extender researched well. Turbo-diesel is an option, even if the vehicle is only built in the USA.

The planning chief suggests increasingly tough fuel economy and environmental standards are also in Santa Cruz’s favour. These could be set to change the US pick-up market, he says.

“CAFE [US government-mandated corporate average fuel economy standards] is not going away… Five times the rate at which vehicle manufacturers have [historically annually] been able to improve fuel economy is the mandate. So, I can easily imagine the pick-up market in the US bifurcating,” he predicted.

“You can easily imagine in the future true work users, whether a plumber or a concrete guy, are going to buy the heavy-duty pickup, but the rest of the market… Maybe they don’t need 11,000-pound towing capacity. Maybe they’re just going to haul a jet-ski or a couple of dirt bikes… and you only need to pull maybe 1500 pounds.

“There’s going to be pressure on [car]makers and customers are going to put pressure on themselves to look at alternatives that do a better job of carbon reduction and fuel economy.

“There’s many things that are coming together to make the potential for a product like this very positive,” he told motoring,com.au.

“There’s no technical reason why it couldn’t [outsell Tucson]. And we’re trying to do platform sharing to be able to be clever with [the design and production of] it and that will deliver a better price and the potential for manufacturing flexibility -- which goes to the volume question,” O’Brien said.