Hyundai & Kia Most Likely to Fill “Tesla Model C” Hole — Readers Chime In!
Earlier today, I ran with an idea someone on our team proposed: I explored the question of which automaker would produce the “Model 2/C” if it’s true Tesla isn’t going forward with this product. Who is most likely to produce a very high selling, affordable electric car globally that’s basically a step (and $10,000) below the Tesla Model 3?
It was a fun question to explore, and I thought I did a pretty decent job, but apparently I failed. I mentioned BYD, Geely, Zeekr, NIO, Xpeng, Ford, GM, Toyota, Honda, BMW, and Audi. But I didn’t consider Hyundai/Kia. Admittedly, I do think that’s a bit of a fail, because Hyundai/Kia might well be the #1 possibility — I’ll get to why in a few moments, but let’s first see some of the critiques.
“Why not Hyundai / Kia? They will have a plant up in Georgia around the end of this year with capacity for 300k EV’s,” dbr2 writes.
“Yea, came to post the same. Ignoring Hyundai and Kia in this article is a huge oversight,” Johnny5 added.
Even fellow writer Steve Hanley chimed in: “I have one word for you Zachary. Hyundai/Kia. Well, technically that is two words but you get my drift.”
Another fellow writer, Juan Diego, came to the table with a little more nuance, or perhaps you could say a critique of the premise. He argued that different brands and models would fill that hole in different regions. For USA and Canada, he wrote, “I think Hyundai/Kia has the lead here. I have high expectations for the Kia EV3 achieving in late 2024 at least part of what Tesla was aiming for with its model. However, Kia lacks the amazing social media presence of Tesla: I would be certain the Model 2 would sell more than the Model 3 in the US, I’m not sure this will be the case for the Kia EV3, and in that case we will have to wait for the Ultium Bolt and whatever comes out of Ford’s new team to fill that niche.” Juan Diego highlighted Renault and Citroën for Europe, and BYD for China.
I don’t know why I overlooked the Hyundai–Kia collaboration in my initial thought experiment and article, but I agree that it might be the most likely candidate. Here’s a list of reasons why:
- Hyundai & Kia do somehow straddle the line between mass market and premium a bit like Tesla does, especially when it comes to EVs. They used to be seen as just cheap budget brands when they broke into the US market in the ’90s, but they have evolved into having some kind of premium aura somehow. Maybe I’m imagining this, but I don’t think so.
- Hyundai Motor Group is also the third-largest automaker in the world! It has the potential, the manufacturing capacity, and the experience to produce a very high selling new model globally. And it has its feet in markets all over the world. It also doesn’t face any of obstacles Chinese EV companies are facing getting into the major markets of North America and Europe.
- Hyundai & Kia have produced some of the most efficient, most attractive, and best-value-for-money electric cars in the world for several years now. As a testament to that, the Hyundai IONIQ 6 just recently won our 2023 CleanTechnica Car of the Year award. The company is certainly more capable than most at designing and producing a mass-market model that is attractive as well as affordable.
That said …
- Hyundai and Kia have seemingly never pushed very hard to produce high volumes of the electric cars they’ve produced, never really leading in that regard. They’ve seemed more content to “play it safe” and not stick their necks out there on EVs.
- As evidence of that, there wasn’t a Hyundai or Kia model in the global top 20 in 2023. Importantly, every model was from a Chinese automaker or Tesla except for the Volkswagen ID.4 at #12 and Volkswagen ID.3 at #15. (Perhaps Volkswagen should really be the top consideration for an automaker that can fill the hole left by Tesla if the Model C is left on the drawing board.)
- As one commenter also noted, “Because even the little Kia Niro costs more than a Tesla Model 3.” And yet another commenter added, “Unfortunately, Hyundai / Kia sell through dealerships, so after their ‘market adjustments’, mandatory ‘protection packages’, fees, and creative financing charges, they will make sure that nothing leaves their lot for less than $35k, no matter what the MSRP is.” These are good points. Though, I think the matters of price and value for the money can be solved by aiming much higher and achieving greater economies of scale with much higher production volumes. That said, we have seen how some legacy automakers have attempted to scale up much quicker and have seemingly failed. Ford comes to mind. Nonetheless, slow and steady often wins the race, and, with steady but serious effort, Hyundai and Kia could achieve what no legacy automaker has achieved before.
I don’t know. I really go back and forth on it. But practically speaking, I hope that we will see Hyundai and Kia bring much more popular electric cars to the market in the next few years. I hope they will continue to drive down EV prices and be willing and ready to sell truly mass-market ones soon. It’s not enough to design and develop great EVs. We need Hyundai and Kia to plan massive scale-up of production in order to benefit from economies of scale, drive down prices, and reach the heights expected of a significantly cheaper Tesla.
I think I’ve covered all the key angles of this discussion regarding Hyundai and Kia, but chime in down below if you feel compelled to elaborate on any of these points or provide your own take on these brands and their electric vehicle offerings.
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