BEV price war not for Hyundai
BY MATT CAMPBELL | 3rd Jun 2024
HYUNDAI Motor Company Australia (HMCA) will not follow Tesla in constantly adjusting its pricing, with the brand saying it has no plans to be part of a price war in the battery electric vehicle (BEV) market.
This does not, however, preclude Hyundai from following the traditional path in offering runout deals on vehicles that are about to be superseded, such as the soon-to-be-facelifted Ioniq 5 SUV and expected revamp for the Ioniq 6 sedan.
According to HMCA chief operating officer John Kett, the brand will not play the price-chop game but said at the recent Santa Fe large SUV launch that the business will monitor the market and react in a responsible manner if the situation deems it necessary.
“The changing price in the Tesla space is obviously disturbing that topic,” Mr Kett said of the recent cut by the US brand to its Model 3 and Model Y, with reductions of $4000 and $5000 respectively for the base-model variants of both vehicles.
"I think for us it's about being clear on the type of volume we need, and when, to make sure that we meet our NVES targets so that we're not constantly revisiting the pricing, he said.
“You'll see us be a little bit aggressive around the run-out of our Ioniq 5 and Ioniq 6 portfolio as we refresh it, but beyond that, once we set that price, we're not trying to become number one in the marketplace in EVs today.
“I think we exited April in fifth position, and we'd like to get a bit further up between our Ioniq brand and our Kona EV, so I thought if we exited the year somewhere close to 4000 to 5000 units, then we've done a fairly solid job both for us and network and sustainability in that pricing.
“So I think that's where we are. But if everyone pushes a certain way, we might have to respond,” he said, leaving the door open to repositioned ranges that have more competitive pricing.
For context, the Ioniq 5 range currently starts from $65,000 plus on-roads, but the updated range – due in a couple of months – will see new tech, a new N Line variant, revised styling and, for some variants, a larger battery pack.
“I think we're really cautious with what we're doing on pricing. We can see what's happening in the marketplace. We've got some pretty innovative new market interest terms of the Chinese and their position,” he said of the current pricing deals on the established Chinese players - and Mr Kett also acknowledged the apparent influx of new Chinese brands planning to set up shop in Australia in the next 12-18 months.
“I think everyone's nervous about it,” Mr Kett said.
“We have to be confident in the things that we're doing; I think, progressively, the constant evolution of our portfolio and the technology that we're bringing, the years that we've been in the country and the lessons that we've learned and the scale that we brought – that whole business model that we started off with is now being replicated by eight or nine brands coming to the market.”
Part of the way that the brand is going to attempt to put its purchasers’ minds at ease is by way of new financial services business with a guaranteed future value program, which in theory will protect the residual value of the car.
“Residuals are key; second life of the EV is something I think we're all trying to try to work our way through to give consumers confidence that an EV does have a life beyond its eight-year battery warranty,” Mr Kett said.
“I think that's where our focus is to bring some focus around the fact that its residual value is more than an eight-year lifespan.”
Hyundai will expand beyond just the Ioniq 5 and Ioniq 6 models in Australia in the coming 12-24 months, with the three-row Ioniq 7 SUV – similar in size and intent to the Kia EV9 – the next model in the mix.
