Hyundai announced plans to freeze fleet sales to increase vehicle production for dealerships, during its make meeting at the end of the NADA Show.

"The plan is for growth," said Kevin Reilly, chairman of the Hyundai National Dealer Council and owner of Alexandria Hyundai in Virginia. "The plan is to add approximately 20% to production this year over last year and the dealers are very excited because they'll have more product."

This announcement comes on the heels of significant supply chain constraints on critical parts, including semiconductor chips.

However, Hyundai North America posted record dales of

Despite supply chain constraints on critical parts such as semiconductor chips, Hyundai Motor America recorded record sales of 694,349 in 2021, a 20% increase over 2020. Last year, Hyundai Fleet Sales fell 24% and represented just 6%of total volume, the automaker said.

By sharply reducing fleet sales, Hyundai can deliver more inventory to dealers, who applauded Hyundai Sales Chief Randy Parker at the Las Vegas event when he announced the moratorium on fleet sales.

"Dealers need inventory," Reilly said. "The message from Hyundai was that they are in agreement, with zero fleet for February, zero fleet for March and zero fleet for April."

Hyundai also announced plans to freeze the dealer network at just over 800 retailers to push greater throughput. The move supports dealers financially as Hyundai asks them to join a facilities program known as Accelerate.

Sales growth will focus on increasing throughput at existing dealerships, the automaker reported. Dealerships will get larger but there will be no more additional dealers. 

Hyundai didn’t share more details about the Accelerate program at the make meeting. About 60% of dealers have already signed up for the program. That number could rise to about two-thirds of the overall dealer network by spring, Reilly said.