New Car Effect Fades
As Kia’s July sales report was released, it was revealed that the sales of its flagship electric SUV, the EV9, which was launched last June, has decreased just two months after its launch. Critics point to the faded “new car effect” as the EV9’s sales have stumbled amid recent controversies over “power loss during driving” due to software defects.
On Aug. 1, Kia announced that it sold 47,424 units domestically in July 2023, a 7.2% decrease compared to the same month last year.
The noteworthy point is that the sales of the new electric EV9 SUV plummeted just two months after its launch in June. The EV9 posted sales of 1,334 units in June when it was first launched, but in July it only managed to sell 1,251 units, a decrease of 83. This is an unusual result, considering that usually a new car’s sales tend to soar month by month due to the “new car effect.”
The Kia EV6, which was launched in August 2021, showed a continuous increase in sales from 1,910 units in the first month to 2,654 in September and 2,762 in October. Similarly, Hyundai's IONIQ 5 also maintained an upward trend for at least three months after its launch in April 2021, with 114 units in the first month, 1,919 in May, and 3,667 in June.
Industry experts estimate that the recent controversy over the power loss issue due to a software error in the EV9 did not affect sales. Professor Kim Phil-soo from Daelim University’s Future Automotive Engineering Department explained, “It’s hard to say that sales have dropped due to a simple defect issue.”
The decisive factor in EV9’s sales drop is the steep starting price of 77.28 million won (US$59,917). In the case of the GT trim, the price approaches 100 million won when options are added. Additionally, the EV9’s significant body size is also mentioned as a factor causing hesitation in purchasing.
One industry expert stated, “The EV9’s marketing position is ambiguous due to its high price and size,” and assessed, “The price of the EV9 is a burden even for the main target market, those in their 40s and 50s, and the body size is not suitable for 20- or 30-somethings to use for commuting.” He further explained, “The EV9 is expected to be sold for secondary car or leisure purposes, so the sales graph’s slope is unlikely to rise sharply in the future.”