Hyundai’s Veloster Turbo is a serious hot-hatch alternative

Hyundai’s playbook in the U.S. market has largely been to mimic that of Honda and Toyota, both in terms of showroom offering and an approach of continuous quality improvement. As automakers flee from building cars en masse in favor of crossovers, however, the new Veloster is evidence that Hyundai is doubling down on small, sporty cars and carving its own path forward.

By the end of the year Hyundai will use the Veloster to launch the N performance division in the United States, a hot hatch with its crosshairs set on the Honda Civic Type R and Volkswagen GTI. But before that main course, Hyundai’s appetizer is the new Veloster and Veloster Turbo, which we sampled in the hills outside of Austin, Texas.

The original Hyundai Veloster launched in 2011, featuring a funky three-door design and practical hatchback shape. But even with the addition of a 201-hp Turbo model in 2012, the Veloster failed to win many friends in the enthusiast world. Its chassis was simply not up to the task—the steering was vague, the ride too wallowy. Anyone seriously considering a small, fun affordable car had too many good competitors to choose from for the Veloster to really make a dent.

None of that was lost on Hyundai when it went back to the drawing board for round two. So what’s different this time around? Aside from the engine—which remains a 1.6-liter turbocharged four-cylinder delivering 201 hp and 195 lb-ft of torque in the Turbo model—pretty much everything.

Under the hood

The base Hyundai Veloster has no real performance aspirations, making do with a 2.0-liter 147-hp four-cylinder engine and the choice of six-speed automatic or six-speed manual transmissions. And while the aforementioned Turbo engine soldiers on largely as-is, Hyundai says it made a considerable effort to improve the clutch take-up feel and shift action for six-speed manual models, even going as far to include a B&M Racing sport shifter on Turbo R-Spec models.

New look, lots of standard equipment

Silly as it seems to some, Hyundai decided to stick with the odd asymmetric body style, with two doors on the passenger side and a single door for the driver. It’s supposed to be representative of the car’s dual personality as a driver-focused vehicle with, when necessary, a more practical side. The old car looked a little cheap and uninspired, and the lack of design balance didn’t help, but the new Veloster looks so much more cohesive that the weird three-door layout sticks out less. The new car features fuller fenders and bigger wheel arches, a lower roofline, and sharper, more defined lines throughout. Particularly striking are the top-trim Ultimate model’s futuristic-looking 18-inch wheels.

Hyundai similarly overhauled the interior, now offering the same wide range of features and technology available on its other vehicles. Bluetooth and Apple CarPlay/Android Auto is standard across the lineup, as are dual USB chargers, and keyless entry with push-button start is standard on every model except the base. Heated seats are available for the 2.0 Premium, as well as the Turbo and Turbo Ultimate, but not on the base 2.0 or R-Spec models. Other available goodies include wireless charging, head-up display, and navigation. Leather comes exclusively on Turbo Ultimate models, but one step down to the Turbo gets you seats with cloth inserts and leatherette bolsters.

Something to prove

Albert Biermann, current head of performance development at Hyundai (and former chief of BMW M), is leading the South Korean automaker’s charge to make its cars legitimately fun to drive. Hyundai sees the Veloster as a lure to capture younger buyers with not just style, but also competitive driving dynamics.

“With the last Veloster, we know we left something on the table,” says ride and chassis lead engineer Wendell Collins, a 13-year veteran with the automaker. Critically, the old car’s twist-beam rear suspension is gone in favor of a multilink setup, saving 8.4 pounds, while the front Macpherson strut suspension uses aluminum steering knuckles to save 10.6 pounds. “There’s only so much you can do with the twist-beam rear, and this multilink suspension gave us the flexibility to improve both ride and handling.” As an additional step in the sporty direction, Turbo models get thicker front and rear stabilizer bars than base models as well as a quicker-ratio steering rack and a unique electric power steering tune.

The results are immediately apparent on the road. The Veloster Turbo’s ride is unflappably composed, especially over road undulations and bumps. But the car’s most surprising aspect is the steering, which has a pleasant, but not overly weighted heft that feels fluid and consistent as you drive through a corner. It’s not a grin-inducing, edge-of-your-seat car to chuck around, like a Ford Fiesta ST. Instead, the new Veloster has a competency and capability we really haven’t seen from Hyundai before, the kind we’d compare favorably to a Volkswagen.

That’s nowhere more apparent than on the Turbo R-Spec, which is the most performance-focused version of the lineup, and also the most affordable Turbo model. Priced right into the meat of the affordable performance market at just under $24,000, the R-Spec is a solid deal. And it’s configured towards performance in an almost old-school way: manual transmission only, handsome cloth seats (sadly without heating), and Michelin Pilot Sport 4 summer tires. Not only do the tires provide more crisp and responsive turn-in, they’re also quieter than the all-season rubber that comes on automatic models.

You can also get the grippy Michelins on Turbo Ultimate models with the manual, but at just over $27,000 it’s less of a value play. And the R-Spec is the only Veloster with the B&M racing short shift kit, which Hyundai Motor America will install when the vehicles arrive in port. It has a satisfying weight that makes it so fun to work through the gears that we wonder why anyone would settle for the turbo’s optional seven-speed dual-clutch automatic.

If there’s a weak spot with the Veloster Turbo, it’s the engine’s utilitarian personality. There’s plenty of low- and mid-range grunt thanks to a peak torque plateau from 1500-4500 rpm, but the fun is over after that. The little 1.6-liter doesn’t return any pleasure with higher revs as a result, and if you try to climb up into the upper reaches of the tachometer your ears will regret it. Imagine a Dirt Devil bouncing off a rev limiter or, better yet, don’t.

Sign of good things to come

If anything, the latest Veloster is proves that Hyundai is getting serious about making its cars attractive to people who really care about driving. The Turbo model is a legitimate alternative to the Civic Si, which only comes in coupe and sedan form. Hyundai also stands to pick up conquests from Ford, as the Focus ST and Fiesta ST won’t be renewed in the U.S.

As for the GTI, Volkswagen is still safe for a while. The Veloster Turbo aims a bit lower on the performance scale, owing in part to less torque from the smaller engine. But Hyundai promises the Veloster N will take the iconic hot-hatch dead-on by the end of this year with its 275-hp four-cylinder turbo, adaptive dampers, and limited-slip differential. Based on our impression of the Veloster Turbo, the N could transform Hyundai into a friendly refuge for car enthusiasts. At very least, it’s an indication that if you care about driving, Hyundai still cares about you.