Industry-leading warranty on cards for Hyundai Nexo

HYUNDAI Motor Company Australia (HMCA) has revealed it is considering a 10-year/unlimited-kilometre warranty for its upcoming hydrogen fuel-cell electric vehicle (FCEV), the fleet-targetting Nexo mid-size SUV.

In a keynote address at the 2018 Australasian Fleet Conference and Exhibition in Melbourne last week, HMCA manager of future mobility and government relations Scott Nargar detailed some of the concerns that fleet managers have with transitioning to electric vehicles (EVs) and FCEVs, including the Nexo.

“One of the biggest things is the practicality and durability of the drivetrains,” he said. “There is still a fear that, whether it be an electric vehicle or hydrogen fuel-cell vehicle, it is such new technology that I’m not going to make an investment because I’m worried about what the vehicle may be worth in the future, or I’m stuck with a drivetrain or batteries that I can’t afford or don’t want to have to deal with at the end of its life.”

As such, global markets will offer the Nexo with a 10-year/160,000km warranty in keeping with their five-year/160,000km term for other Hyundai models, but given HMCA’s five-year/unlimited-kilometre standard, Mr Nargar said it may go a step further.

“We’ve got to make a decision whether we go 10-year/unlimited-kilometre (warranty) on this car with the consideration that if you take into account that it’s used as a taxi, a lot of the time we cover a taxi for 10 years. So, we’ve been working on some ideas there.”

A 10-year/unlimited-kilometre warranty would reset the benchmark for models sold in the Australian market, eclipsing Tesla Australia’s recently-announced eight-year/160,000km term for electrical and mechanical defects and Kia Motors Australia’s seven-year/unlimited-kilometre standard.

Mr Nargar highlighted the Nexo’s ‘second life’ potential as another major selling point for fleet customers, who stand to receive a return on their investment in FCEV technology.

“Having a drivetrain with a 10-year warranty, we can go into a government fleet for three years … and as it comes into its third year, they look at that second life of the vehicle … how do they maximise those returns?

“Whether it be ride share, Uber or a private customer; they can make their money back second-hand by selling it or leasing it in the second life with a seven-year factory warranty – we’ll back up that drivetrain, we have no fear. That drivetrain will easily do 10 years.”

While Mr Nargar confessed the Nexo “is quite an expensive vehicle”, HMCA has not locked in final pricing yet, but it is expected to carry a hefty premium over the similarly-sized Tucson, which currently tops out at $47,450 before on-road costs.

Another roadblock facing the Nexo and other FCEV’s introduction is Australia’s lack of hydrogen refuelling stations, with HMCA establishing Australia’s only current example at its headquarters in Macquarie Park, New South Wales, in December 2014.

As previously reported, the ACT government purchased 20 Nexos as part of its Hornsdale Wind Farm project, with these deliveries to commence early next year, but Mr Nargar revealed that larger volumes will not be imported until appropriate infrastructure and demand is established.

“We won’t start building hundreds of cars until there’s a market for it,” he said. “We’ll build cars for our station in Sydney, and as (other) stations come online, we’ll target corporate and government fleet customers in that area and we’ll starting rolling out cars into those stations.

“I’m very confident that we’ll see stations here in the next 12 to 18 months. There’s things happening, and we’ve got right-hand-drive production because of some of the commitments that were made to different places in Australia.

“We’ve been close a few times. We’re just waiting for that first big commercial station, and we know we’ve got the right partners to do it, and we know that some of the plans our partners have got in the pipeline are firm.”

Mr Nargar added that there are currently about 20 companies that can build a hydrogen refuelling station for fleet customers in Australia that request it.

While HMCA spent $155,000 on its hydrogen refuelling station, they can typically range in price from $100,000 to $2 million, with the latter price including the ability to self-produce hydrogen.

Meanwhile, HMCA plans to launch 37 other ‘eco’ powertrains – including hybrid, PHEV, EV and FCEV – by 2025, including the Ioniq EV small liftback around September and the Kona Electric small SUV, which starts production in November.

Additionally, Hyundai’s luxury brand, Genesis, is developing its own high-performance EV models that will fall under this roadmap.

Mr Nargar confirmed that more FCEVs will be part of this onslaught, with the next such model to be a passenger car.

“The next (FCEV) platforms will be passenger vehicles, not SUVs,” he said. “We want to make sure we have, for markets where SUVs aren’t dominate, a platform that’s … able to meet that (demand).”

Honda’s Clarity and Toyota’s Mirai are two FCEV sedans that Hyundai’s unnamed model will take on in particular markets, including North America and China, when it starts rolling off the production line during the next seven years.