A Bold Move to Penetrate U.S. EV Market
Hyundai Motor Co. will produce the Genesis GV70 electric vehicle (EV) model at its plant in Alabama of the United States starting from early next year. The GV70 EV will become the first EV model of either Hyundai Motor or Kia to be produced in the United States. Analysts say Hyundai Motor has made the surprising decision to expand its presence in the rapidly growing U.S. EV market.
Hyundai Motor shared its plan to produce EVs at its U.S. plant with the labor union at a Job Security Committee meeting at its Asan plant on Nov. 2. Starting next year, it will launch EVs in the U.S. market in earnest, and major models will be produced at the Alabama plant, starting with the GV70 EV. Then, other EV models will be rolled out one after another at the Alabama plant.
Analysts say that Hyundai Motor has made a bold move to target the U.S. EV market. The automaker is seeking to penetrate the U.S. EV market by producing its vehicles locally from the beginning of next year. It aims to take its brand image to the next level by rolling out the GV70 EV first. The U.S. EV market, which was 360,000 units in 2020, is expected to grow rapidly to 7.2 million units in 2030 and 12.5 million units in 2040.
Hyundai Motor intends to respond to the U.S. government’s policies in advance. President Joe Biden announced a plan to raise the portion of EVs to 50 percent of newly produced cars by 2030, and the U.S. Congress is reviewing a bill that will provide subsidies only to EVs produced in the United States from 2027.
Recently, Hyundai Motor and Kia have performed better than expected in the United States. From January to October 2021, the two automakers sold 1,289,608 units in the United States, an increase of 29.3 percent compared to the same month of 2020. On an annual basis, it is likely to surpass Honda (1,276,507 units from January to October) for the first time. Genesis sold 5,300 units in October, the largest since it entered the United States. Compared to 1,054 units in October 2020, the sales figure quintupled.
In particular, sales of the GV70, a medium-sized sports utility vehicle (SUV) launched in the United States in June, have been on a steady rise. Analysts say that Hyundai Motor chose the GV70 as its first EV model to be produced in the United States by taking into account its recent sales performance.