December 01, 2024

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Hyundai Motor Company’s Santa Fe Hybrid (Hyundai Motor Company)

Hyundai Motor Group is expected to ramp up sales of hybrid electric vehicles in the US, bracing for US President-elect Donald Trump’s drastic EV policy changes, sources said Friday.

According to Hyundai Motor Company and Kia, the two carmakers already sold 275,103 eco-friendly vehicles in the US from January to October this year, with HEVs accounting for 63.1 percent of these sales. Compared to last year, the cumulative sales until October have surged by 11.3 percent. Last month alone, Hyundai and Kia sold 21,679 units, a substantial increase from January’s 11,000 units.

The surge in HEV sales comes after an EV slowdown in the US this year, which is likely to intensify as Trump’s second administration wants to push Congress to scrap current President Joe Biden’s $7,500 consumer tax credit for purchasing EVs in the Inflation Reduction Act.

Industry watchers say Hyundai Motor and Kia would bolster their hybrid car business, which will be back in the limelight as alternatives to full-electric vehicles in the all-important US market.

“Compared to gasoline-powered cars, hybrid vehicles boast approximately 10 percent higher profit margins,” said a source familiar with the matter on condition of anonymity. “Despite concerns about a temporary delay in the transition to EVs, Hyundai Motor and Kia are committed to turning the crisis into an opportunity.”

At the LA Auto Show on Nov. 22, Jose Munoz, the incoming CEO of Hyundai Motor Company, also stated, “Electrification is the long-term path we should follow, but we are prepared for flexible adjustments along the way. We are ready to produce hybrid vehicles, plug-in hybrid vehicles, extended-range electric vehicles and even hydrogen fuel cell electric vehicles.”

Hyundai Motor, in particular, is poised to produce its HEV lineup, which could take up to one-third of the maximum annual capacity at its newly built car manufacturing plant in the state of Georgia.

Despite the Korean automaker’s hybrid push, experts noted it might be challenging to claim the No. 1 title in the hybrid vehicle market in the US due to its Asian rival, Toyota.

“Competition with Toyota, the global leader in hybrid technology, will be fierce in the US. The Japanese auto giant already holds a strong footing in global markets,” said Lee Ho-geun, a car engineering professor at Daeduk University. “Even before the EV chasm, Toyota pursued a sales strategy centered around hybrid-only models. Hyundai and Kia would have to employ aggressive pricing or advance their HEV technologies to outpace Toyota.”

According to data from MarkLines, cited by SK Securities, Toyota sold the largest number of hybrid vehicles last year, with 2.48 million units last year, reaching a 35 percent market share. Hyundai Motor ranked sixth, selling 346,723 units with a 5 percent share, followed by Kia’s 312,449 units and a 4 percent share.

By Byun Hye-jin  (hyejin2@heraldcorp.com)