Hyundai to raise Tucson Hybrid output in Korea for exports

Hyundai Motor Co., South Korea’s top automaker, plans to ramp up production of the sport utility vehicle Tucson’s hybrid version in the country for exports to meet the growing demand worldwide, especially in the US, the world’s second-largest automobile market.

Hyundai is scheduled to start manufacturing the Tucson Hybrid at the No. 3 plant at its Ulsan production complex as early as July to increase the output by some 10,000 units of the trim by year-end, according to industry sources on Sunday.

The affiliate of Kia Corp. has been producing the compact SUV equipped with a 1.6-litre gasoline engine and a hybrid electric motor only at the No. 5 factory at the complex, about 300 kilometers (186 miles) southeast of Seoul.

The move came as global automakers shifted their eco-friendly vehicle strategies to focus on hybrid cars as electric vehicle growth has recently lost steam on shrinking demand. Hyundai plans to manufacture hybrid models at its electric vehicle and battery plant in the US state of Georgia given the longer-than-expected slowdown in the global EV industry.

“Hybrid models were expected to make up 11% of our total sales this year, up from 9% last year,” said Koo Zayong, head of Hyundai’s investor relations, earlier this year. “Hybrid models are expected to account for some 15% of total sales by 2030, while EVs are likely to make up about 34%.”

Hyundai and Kia were together the world’s fifth-largest hybrid car maker by selling 175,979 units last year, following Toyota Motor Corp., the Renault-Nissan-Mitsubishi Alliance, Suzuki Motor Corp. and Monda Motor Co., according to automotive industry portal MarketLines Co.

TO MEET SURGING DEMAND

Hyundai sold 16,848 units of the Tucson Hybrid in the US from January to April, up 35.6% from a year earlier. In April alone, the company sold 4,588 units of the eco-friendly compact SUV, 45.4% of its total hybrid models sold in the country.

Despite the strong sales, Hyundai has yet to produce the Tucson Hybrid at its Alabama plant, which manufactures the SUV models with internal combustion engines.

Hyundai has been in the test production of the all-wheel drive Tucson Hybrid at the No. 3 plant in Ulsan since April, after adjusting facilities of the line, which mainly manufactures the compact sedan Elantra and the small SUV Kona.

The Tucson Hybrid is a profitable model with a starting manufacturer’s suggested retail price of $32,575 in the US. That compared with the lowest price tag of 32.1 million won ($23,199) in South Korea.

Hyundai is expected to use the increased volume for other markets including South Korea where demand for the hybrid compact SUV is strong.

It takes about four months in the country for a customer to receive a new Tucson Hybrid after placing an order as its sales rose 26.9% to 8,476 units in the first four months of the year.

Write to Jung-Eun Shin at newyearis@hankyung.com
 
Jongwoo Cheon edited thi article.