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Hyundai, Kia slim down product lineups to boost competitiveness

Hyundai Motor Veloster N / Courtesy of Hyundai Motor
Hyundai Motor Veloster N / Courtesy of Hyundai Motor

By Kim Hyun-bin

Hyundai Motor and affiliate Kia are slimming down their product lineups to focus on more popular vehicles to maximize profitability and competitiveness. Several of their models have been discontinued in order to enhance the production and sales efficiency of flagship and more-popular vehicles.

According to the industry sources, Hyundai Motor has discontinued its once-popular i30, Veloster and IONIQ hatchbacks and completely halted sales of the vehicles in the local market starting this year.

The move comes as there had been insufficient demand for the vehicles in recent years, resulting in disappointing sales. When first released, the hatchback models gained instant popularity. However, market demand started to shift towards SUVs.

The i30 was released in 2007 as a European-style hatchback and Hyundai sold over 2,000 of them a month in the local market alone. However, sales started to decline from the second-generation i30 model released in 2011 and fell even further for the third-generation model that was launched in 2016. Last year, only 517 i30s were sold, which is a drop of 65.7 percent from 2019. The fourth-generation i30 is scheduled to hit the market next year only in the European market.

Hyundai Motor i30 N / Courtesy of Hyundai Motor
Hyundai Motor i30 N / Courtesy of Hyundai Motor
The Veloster was an eye-catcher when it debuted due to its chic design and safety features. But that did not stop Hyundai from halting production of the model. Hyundai will keep selling only the premium Veloster N version. But sales of even that version have been stagnant, totaling only 83 in the first two months of this year.

Hyundai's eco-friendly IONIQ hatchback will be discontinued just four years after its debut. The IONIQ 5 EV will take its place. Last year, Hyundai managed to sell 3,567 IONIQs, including hybrid, plug-in hybrid and electric versions, a 40.8 percent drop from 2019 sales.

With the release of the IONIQ 5, production of the mid-sized Kona electric SUV is also expected to be halted once sales of the IONIQ 5 gain traction.

Kia is also quietly discontinuing the Soul compact hatchback and Stonic small SUV in the local market. Sales of those models were anemic in Korea. However, the two models will continue to be produced for the overseas market.

The Soul's production totally shut down in January, just two years after its third-generation model was released.

The move comes as the Kia Seltos has been gaining popularity in the SUV sector. The Seltos was released in 2019 and has been known for its cost-effectiveness compared to the Soul and Stonic. That led the Seltos to bite into the market share of the Soul and Stonic.

"All of the models that are being halted starting this year failed to appeal to prospective customers over the years leading to bad sales figures," a Hyundai Motor official said.

The cessation of the models is seen as a market strategy to focus production and sales on popular models in hopes of enhancing their competitiveness and profitability.

Shifting focus to future mobility

Hyundai Motor has been investing in and speeding up the development of its future mobility businesses, including urban air mobility (UAM) as well as electric and hydrogen-powered vehicles and infrastructure.

The company aims to roll out UAMs and create tangible results by 2026, aiming to showcase an unmanned aircraft system using a cargo hybrid powertrain in 2026, followed by an electric UAM model designed for urban operations by 2028, while promising to launch an inter-city UAM by 2030.

Hyundai Mobis, the country's leading car parts maker, also seeks to transform itself into a future mobility services and platform provider.

The company plans to increase investments in developing future mobility technologies, such as autonomous driving, electrification and connectivity, while also producing electrified propulsion systems for urban air mobility (UAM) as a future growth driver, as well as searching for new investment opportunities overseas in the field, the company said.


Kim Hyun-bin hyunbin@koreatimes.co.kr


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