Hyundai is officially the third-largest automaker globally after jumpstarting the brand in 2022, behind only Volkswagen and Toyota. However, the South Korean automaker may have an advantage as the auto industry transitions to electric vehicles.
The Hyundai Motor Company, including Kia and Genesis, is establishing itself as a true competitor after surpassing General Motors (GM), Nissan, and Stellantis in annual volume this year, according to Bloomberg. Hyundai’s co-CEO Jaehoon Chang said in an interview:
We are on the right track, and this year we were very strong.
He cited flexible supply chain management as key to the automaker successfully navigating the semiconductor shortage.
The company has leaned heavily into EV tech, looking toward the future of travel, while some automakers (looking at you, Toyota) have failed to embrace the movement.
Hyundai has maintained a progressive approach, releasing electric models such as the IONIQ 5 and Kia EV6, which continue to drive significant demand. The new releases helped Hyundai achieve a record November sales month in the US, as it battles with Ford for second in US electric vehicle sales.
North America is now Hyundai’s largest single market, representing around 21% of its total sales last year. Furthermore, after passing the Inflation Reduction Act, North America has become a hot spot for EV investments, with sales expected to rise sharply over the next several years.
The progress is largely thanks to Hyundai’s early 19.4 trillion won (around $15.2 billion) investment into electric vehicle technology. As part of Hyundai’s strategy, the South Korean automaker is striving for 1.87 million EV sales globally, or around 7% of the global market share, by 2030.
Toyota’s first electric vehicle, the bZ4X, has a less-than-ideal rollout after a safety recall concerning the wheels falling off derailed its momentum. Despite resuming bZ4X sales in October, Toyota has failed to gain any real momentum with its EVs. Perhaps, more importantly, Toyota doesn’t seem to want to go fully electric.
Can electric vehicles help Hyundai edge out Toyota?
The Hyundai Motor Company’s total sales are up 1.2% year-to-date in 2022, thanks to “strong new models and rising demand.” IONIQ 5 sales more than doubled this year, selling over 88,000 units from January to November.
The Kia EV6 has sold over 23,000, while the newly released Hyundai IONIQ 6 (the initial batch sold out in just a few hours) has nearly sold 4,000 units since launching in October, with the US rollout slated for next year.
This past week, Hyundai revealed a new “EV-inspired” design for its new KONA lineup, showcasing the direction in which the automaker is headed.
As a result, Hyundai is on track to expand revenue by 21% to 141.7 trillion won ($108 billion), which would be the highest growth rate among the major automakers, according to projections.
Top comment by Tracy Principio
My wife drives a 2019 Kona Electric. Even though the main battery was replaced under warranty, I feel that car is extremely well made. We'll be test driving the 2024 model once it's available.
Although analysts believed a slowdown was inevitable for Hyundai in the US after the Inflation Reduction Act kicked in, the bill’s strict battery sourcing requirements are now being delayed until at least March as the automaker works to build up its EV production capabilities.
Toyota’s sales are flat year-to-date compared to last year. However, regarding fully electric vehicles, Toyota has only sold 18,569 globally through November.
With almost all major auto markets (China, the US, Europe, etc.) moving toward fully electric vehicles, Hyundai seemingly has the upper hand. It already has a dedicated EV platform (E-GMP) and is already planning a purpose-built electric vehicle platform, the integrated modular architecture (IMA), to streamline production.
Toyota has recently taken note of Tesla’s success in the EV market, considering plans to build a new EV platform from scratch. Hyundai is building its business around electric vehicles, while Toyota continues fiddling around with other technology like hybrids and hydrogen fuel cells. Who will win in the end? Check back soon as EV sales continue climbing globally.
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