Hyundai Motor Co. and Kia Corp. aim to lower the price of some electric vehicles (EVs) to boost clean car sales. This business move follows South Korea's subsidy increase as demand for electric cars drops.
To coincide with the government's temporary subsidy extension, Hyundai and Kia will implement price reductions on a select number of EV models. According to reports, the two leading car companies in South Korea will implement their EV price drop until the end of 2023.
Big EV Discounts Offered
Electrek reported that Hyundai's "EV Sale Fiesta," launched on Monday, provides tempting discounts to purchasers of electric vehicles. The IONIQ 5, IONIQ 6, and Kona EV are among the vehicles included in the campaign.
With this Hyundai price discount offer, EV buyers may save 4 million won ($3,000), 2 million won ($1,500), and 4 million won ($3,000) on the IONIQ 5, 6, and Kona EV.
The IONIQ 5 can additionally receive an 800,000 won government subsidy, saving buyers up to 4.8 million won ($3,500). With beginning costs for the IONIQ 5 at around 46 million won ($34,000), these price cuts will drastically decrease the price of EVs in South Korea.
Meanwhile, Kia is offering similar discounts on the Niro EV and Niro Plus models (1.44 million won/$1,066 off), as well as the EV6 (3.84 million won/$2,844 off). When combined with Kia's monthly inventory discount, the EV6's price drop is up to 4.84 million won ($3,600), while the Niro EV and Plus receive 3.44 million won ($2,500) and 4.44 million won ($3,300) reductions.
EV Price War in South Korea to Intensify
Hyundai and Kia slashed EV prices due to South Korea's shaky economy and EV demand drop this year.
Lee Hang-Koo, the director of the Jeonbuk Institute of Automotive Convergence Technology, predicts a heightened EV price war in South Korea's auto industry with the anticipated introduction of new models from international automakers, per Benzinga.
Foreign rivals have already entered the market; beginning in July, Tesla will sell its made-in-China Model Y SUV for $44,000. Additionally, in a collaboration with China's BYD Co., KG Mobility Co., previously known as Ssangyong Motor Co., recently unveiled an electric SUV with a $30,000 price tag.
This year, Tesla's significant price reductions are pressuring Hyundai, Kia, and other major car companies in their own countries as consumers switch to all-electric units.
South Korea's pricing reductions, which have made certain vehicles a third cheaper than elsewhere, could contribute to global EV price pressures, according to a Bloomberg report.
The South Korean Ministry of Environment reported a drop in EV sales from 71,744 to 67,654 in the first eight months. The South Korean government decided to boost subsidies due to this drop. According to official figures, the Seoul municipal government has subsidized 5,522 EVs out of 13,688 slated for 2023.
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