Hyundai is determined to distance itself from the pricing bloodbath in the EV market over the last few months.
The Korean auto brand is about to release updated versions of its Hyundai IONIQ 5 and IONIQ 6 electric cars ahead of the arrival of two important new battery-powered SUVs, including a sub-$35,000 compact crossover based on the Casper and the IONIQ 7 seven-seat large SUV.
But Hyundai Australia COO John Kett has left the door open to revise prices if the significant EV discounting – which has been led by Tesla, MG, GWM, Polestar, Ford and even Lotus – continues.
He said Hyundai would seek to grow its market share as EVs continue to play a more important role in the new vehicle sales mix ahead of the 2025 New Vehicle Efficiency Standard (NVES), which will cap the CO2 outputs of new cars.
“We’re really cautious on what we’re doing on prices,” said Kett of the pricing for its EV models, before adding that it was a fine balance between ensuring competitiveness and not chopping and changing on prices, which can impact consumer confidence and resale values.
“It’s about being clear on the type of volume we need and when to make sure we meet our NVES targets, so that we’re not constantly revisiting EV prices,” he said.
But Kett said the imminent arrival of heavily revised versions of the IONIQ 5 electric SUV and IONIQ 6 electric sedan would lead to some sharp runout deals.
“You’ll see us a little bit aggressive around the runout of our IONIQ 5 and IONIQ 6 portfolios as we refresh it,” he said.
However, Kett said the aim with the updated versions was to set a fair price and stick with it.
“Once we set that price, we’re not trying to become number one in the marketplace in EVs today.”
That said, it seems growing market share will take precedence if the wild EV pricing fluctuations continue.
“If everyone pushes a certain way we might have to respond,” said Kett.
The Hyundai Australia COO said the goal was to sell as many as 5000 EVs in 2024, which would bring Hyundai closer to the market average – and roughly double its EV sales from 2023 (2417).
Kett nominated residual values of used EVs as a crucial part of the mix moving forward, something that would see the brand place an increased emphasis on giving buyers confidence in buying new vehicles.
In the fourth quarter of 2024 Hyundai plans to launch Hyundai Capital, a wholly-owned finance division that will provide guaranteed residual values to new-vehicle purchasers.
“This is where we can truly start getting involved in guaranteed future values,” said Kett.
“Residuals are key. [The] second life of an EV is something I think we’re all trying to work our way through, to give consumers confidence that an EV does have a life beyond its eight-year battery warranty.”
Kett also said the size of the Hyundai dealer network and an increased focus on used vehicles will play a key role in its future success in the EV market.
“We’ve got 163 dealers. They certain engage in trade-ins around Hyundai and Hyundai EVs,” he said.
“They’re a little bit reluctant to do other brands, so we’ve got to give them confidence through our Hyundai Promise program – which is our certified used cars – that we can make EV a compelling used car story.”
And there’s clearly plenty of effort being put into the used EV story at a time when residual values of electric cars are struggling.
“We really think the benefit our network will bring to our certified pre-owned program lends itself to a strategy on used cars for EV,” said Kett.