Hyundai quietly makes large gains in the EV race as sales rise

Car maker aims to capture 12% of the global EV market by 2030

FILE - In this July 26, 2018 file photo, the logo of Hyundai Motor Co. is seen at its showroom in Seoul, South Korea. Hyundai is adding about 471,000 SUVs to a September U.S. recall for an electrical short in a computer that could cause fires. And the company is warning owners to park the SUVs outdoors until they are repaired. Hyundai said Friday, Jan. 8, 2021 that the recall comes as part of a continuing investigation into the problem. The company said it's aware of a dozen fires but no injuries related to the recalled vehicles. (AP Photo/Ahn Young-joon, File)
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Pipe down for a second Elon Musk, the hottest things in the auto industry — the most electric electrics — now come from Hyundai Motor.

Earlier this year, the South Korean carmakers Hyundai Motor and Kia rolled out two new battery-powered cars — the Hyundai Ioniq 5 and its sibling, the Kia EV6 — which promptly tore up the sales charts, passing the Nissan Leaf, Chevrolet Bolt and every other electric vehicle on the market not made by Tesla. In the US this year through May, Hyundai and Kia sold 21,467 of these two machines, besting even the white-hot Ford Mustang Mach-E, which was snapped up by 15,718 drivers.

“From an EV perspective, they’re really just kind of cleaning the floor,” said Edmunds analyst Joseph Yoon. “I honestly don’t know if any dealers around me have any in stock.”

Tesla still sells far more cars, but it took the company a decade to deliver as many electric vehicles as Hyundai and Kia have managed in a few short months. Even Mr Musk has been impressed.

Granted, Hyundai is no start-up. And the design of the current hits started about six years ago, said Steve Kosowski, manager of long-range strategy at Kia America. At the time, the Chevrolet Bolt had just hit the market and Kia considered a car similar in size and scope. Ultimately, Mr Kosowski and company greenlit something far larger, sportier and swankier — at a slightly higher price.

“The thinking was, with the platform we have and the market understanding we have, let’s put together a really bold, breakthrough proposition,” he recalls. “We’re going to make a statement that Kia is here.”

The timing was favourable. EV adoption is picking up in the US, thanks to a surge in both climate concern and fuel prices. And though there’s a run on battery-powered vehicles, there still aren’t many to choose from. Of the 30 or so models for sale on the US market, only a handful can be had for less than $45,000 and most of those are relatively small, dated cars like the Nissan Leaf.

The Ioniq 5 and EV6 both offer the cargo space of a small SUV, the size and shape of vehicle that has taken over US garages of late. Both cars ride on the same modular platform, incorporate the same motors and batteries and post similar speed specifications. They are tricked out with screens and charge at some of the fastest rates in the industry, adding almost 25 kilometres of range in a minute under ideal conditions. They also offer a couple of features that are novel in the space: pedals to adjust regenerative braking and bi-directional power (yes, you can run power tools or charge another EV with one of these machines).

Starting at about $40,000, they are drawing buyers with smaller budgets who otherwise may have bought a starter sedan, said Mr Yoon at Edmunds. And yet, they are plush enough inside to pull from the top of the market as well, as drivers trade in luxury cars with internal combustion engines.

“These two cars have come in kind of at the right price and the right size for a lot of buyers,” Mr Yoon said. “And I think there’s a level of inherent trust with a big manufacturer getting in the game with a mainstream.”

Emad Zia and his wife had only been planning to “dip our toes” in the EV market when Hyundai’s new cars were launched this winter. The two are fond of sporty cars — preferably with a stick shift — but wanted something bigger than the Volkswagen Golf R and Mazda Miata in their Dallas garage. They settled on the Ioniq 5 purely based on photos and speed specs, then ordered an EV6 when they couldn’t find the Hyundai anywhere close to the sticker price.

Hyundai's Ioniq 5 electric vehicle during a test drive in Tokyo, Japan.   Bloomberg

“We’re used to having — I don’t want to say underdogs — but unique cars,” Mr Zia said. “And the looks and uniqueness of this car just doesn’t get old.”

So far, roughly three in four EV6 buyers were previously driving a car from another brand, Kia figures show, and only one in 10 has previously owned a plug-in vehicle. The current wait-list for the EV6 is about six months long and the average transaction price is a few thousand dollars above the sticker price, according to Bloomberg Intelligence, which suggests most buyers are willing to pay a premium.

“Our dealers are reporting that these cars are sold within hours,” said Eric Watson, vice president of sales at Kia America.

Mr Kosowski said the new Hyundai products are capitalising, in part, on “Tesla fatigue,” as the first-mover sedans and SUVs become ubiquitous even beyond coastal states. Also, Hyundai owners are sticking with what they know — of those trading in a Hyundai or Kia recently, about 60 per cent stayed with the brand, according to Edmunds.

Hyundai plans to launch a new battery-powered car every year for the rest of the decade and is spending $16.5 billion to boost EV production in South Korea. By 2030, the car maker wants to claim 12 per cent of the global EV market, some 3.2 million cars and trucks.

“They definitely have a leg up,” Mr Yoon says. “Toyota and Subaru will have to see if they can catch them.”

Updated: June 26, 2022, 4:00 AM
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