Business

Hyundai quietly beat GM, Nissan and Stellantis


Kia’s parent company, Hyundai Motor Company (OTC: HYMTF) beat General Motors (NYSE: GM), Nissan Motor Co Ltd (OTC: NSANY) and Stellantis NV (NYSE: STLA) in terms of annual sales and is now behind Volkswagen AG (OTC: VWAGY) and Toyota Motor Corporation (NYSE: TM) is the world’s third largest automaker.

The Korean automaker has come a long way since its founding

Founded more than half a century ago as a maker of affordable vehicles for the domestic market, the automaker’s international expansion began in the 80s. After much Decades of work to reinvent its image as an up-and-coming company, Genesis, Hyundai’s premium subsidiary, is now up against the world’s most luxurious car brands, while the auto maker This car is competing with Ford Motor Co (NYSE: F) takes second place in electric vehicle sales in the United States, behind Tesla Inc (NASDAQ: TSLA).

electric vehicle strategy

With the Ioniq 6, Hyundai’s latest electric model aimed at young, fee-led buyers, the automaker is embracing electrification. While Volkswagen is working to get its electric vehicle strategy on the right track and Toyota is still considering a bet on hybrids, the Korean company has already launched models like Kia’s Ioniq 5 and EV6 as soon as demand. began to oversupply.

Fueled by its success and backed by $19.4 trillion in investments, Hyundai plans to introduce at least 17 battery-electric electric vehicles by the end of the decade, in addition to Kia’s 14, which This will help the automaker meet its goal of selling 1.87 million electric vehicles a year by 2030. According to co-CEO, Jaehoon Chang, the company is on track to achieve this goal, accounting for 11 % of the US market and 7% of the global market.

Challenges remain

Bigger challenges come with greater scale. The automaker is trying to be flexible, while optimizing and protecting production as much as possible despite chip shortages, higher raw material costs, and allegations that suppliers in Alabama employed underage workers.

America’s challenge

Last year, North America accounted for 21% of total sales, making it Hyundai’s largest single market, while its home market accounted for only 17% of sales.

The US Inflation Reduction Act requires electric vehicles to be assembled in North America with batteries made from materials sourced from friendly trading partners in order to qualify for the tax credit. Hyundai has worked with the South Korean government to convince the US Treasury Department to revise the bill or relax enforcement until the guidelines are finalized.

Although the law requires automakers to assemble their electric vehicles in North America in order to receive subsidies, Hyundai does not yet have any EV plants in operation, although it aims to built a $5.5 billion battery and electric vehicle manufacturing facility in Georgia. The Korean automaker has requested a degree of flexibility from the authorities to give it time to realize its facility in the United States.

Its global presence stems from its in-house manufacturing facility

Its strong manufacturing base in South Korea holds the world’s largest assembly plant with an annual production capacity of 1.4 million vehicles in addition to its nine factories spread across the globe.

Rise after the pandemic

The company’s steady growth was hampered by the pandemic but the entire auto industry was hit hard in 2020. By 2021, Hyundai’s output and sales both increased, ending year with 6.6 million vehicles sold, while Volkswagen sold 8.9 million vehicles and Toyota 10.5 million vehicles. This year, sales are on track to grow 21% to $108 billion, the fastest growth rate among major automakers, according to analysts’ median forecasts.

Challenging premium brands

The company is also challenging the Mercedes-Benz AG Group (OTC: MBGAF), Bayerische Motoren Werke Aktiengesellschaft (OTC: BMWYY) and even Tesla with the Genesis brand saw strong growth. Hyundai plans to make the luxury sedan all-electric by the end of the decade. According to Euisun Chung, co-CEO and executive chairman, Hyundai is also looking to reposition itself as a more premium brand in China by honing its edge.

Last month, auto sales in the world’s largest market fell 4.2 per cent as re-installed Covid-related lockdowns kept buyers away from showrooms.

The Korean auto giant has come a long way since its “affordable roots” founded 55 years ago. Not only has it succeeded to become the world’s third-largest automaker this year, but it’s also trailing Ford to take over as the second-largest electric vehicle brand in the US.

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