by Hyundai’s experiment with a compact pickup truck is over. After just one generation, production of the Santa Cruz model is reportedly being discontinued ahead of schedule due to low demand, which has led to excess inventory at dealerships.
Market Failure and the Reason
The idea sounded great: take a comfortable crossover, attach a small bed, and sell it to active people. However, reality proved harsher. The Santa Cruz failed to find a clear identity, landing somewhere between a “lifestyle toy” and a real pickup truck, not fully satisfying enthusiasts of either format. Even the introduction of the more off-road-oriented XRT version in 2024 didn’t help.
Sources close to the matter, including company suppliers and individuals familiar with internal discussions, confirm this information.
Meanwhile, the Ford Maverick, with a hybrid version that the Santa Cruz lacked, captured the lead. Ford’s smallest pickup recorded 155,000 sales last year, an 18% increase over 2024. During the same period, Santa Cruz sales fell by 20%, to just 25,500 units.
Production Cessation and Consequences
Dealers ended up with months’ worth of unsold Santa Cruz inventory. In response, Hyundai cut production “approximately in half this quarter” and is preparing to cease it entirely earlier than the initial target of the second quarter of 2027.
This will free up capacity at the Alabama plant for the production of the more popular Tucson, whose sales grew by almost 14% to 234,000 units last year.
Hyundai’s New Plans
However, Hyundai is not abandoning the pickup truck idea. Instead, the company seems to acknowledge that American buyers want something larger, more rugged, and more traditional.
The company has already confirmed it is working on a new mid-size pickup, with a US launch planned for 2029. Unlike the Santa Cruz, built on a crossover platform, this new model will have a sturdy body-on-frame construction, targeting market players like the Toyota Tacoma and Ford Ranger.
CEO José Muñoz even hinted that an SUV built on the same platform as the pickup could be added to the lineup to compete with the Toyota 4Runner and Ford Bronco.
This shift towards larger models is logical. True pickup trucks still dominate the US market, and buyers often prefer power, payload capacity, and a “tough” image over clever design solutions. Larger pickups also provide higher profitability for manufacturers. The question is whether Hyundai’s second attempt will finally succeed.
The compact pickup market remains niche, and the success of the Ford Maverick shows that the key may not only be size but also the right combination of practicality, economy, and technology, such as a hybrid powertrain. The Santa Cruz experience has been an important lesson for Hyundai about the specifics of American preferences. The future body-on-frame pickup will test the company’s ability to create a product that can compete at the heart of the most traditional and demanding segment. The success of this project could significantly change Hyundai’s perception in the US market, transforming it from a manufacturer of mostly passenger cars and crossovers into a serious player in the light truck segment.
