Hyundai, Kia see backorders exceed 1 million vehicles

Hyundai cars are on standby to be shipped at the company's export loading dock in Ulsan. Yonhap

By Kim Hyun-bin

Hyundai Motor and Kia have been unable to deliver vehicles to all their customers on time, as the global shortage of automotive semiconductors continues, with their combined backorders exceeding 1 million as of March, according to industry officials on Wednesday.

The Russian invasion of Ukraine and the shutdown of plants in China amid the ongoing COVID-19 pandemic have worsened the company's production capabilities.

Kia's domestic backorder volume increased from 100,000 vehicles at the beginning of last year to 500,000 last month. The figure combined with Hyundai Motor's backorders is expected to exceed 1 million vehicles, which means their production has been delayed.

The backorders account for 15 percent of Hyundai Motor and Kia's total sales of 6.66 million cars last year. The two companies have set a sales goal of a total 7.47 million cars this year, but the delay has become a major barrier.

In March, Kia's domestic production was set back by 26,000 vehicles, with the company only able to reach 82 percent of the production target. Among the setbacks, 19,000 vehicles were due to a lack of semiconductors and 7,000 cars were from shortages of wiring harnesses.

Overseas factories in the U.S., Mexico, Slovakia and India also suffered production disruptions of 14,000 vehicles. In a recent conference call, Kia explained, "The average number of contracts per day is increasing, but backorders are also increasing due to a lack of production."

Many analysts believe the global semiconductor supply shortage will continue throughout the rest of the year. According to market research firm AutoForcast Solution, the global car production delay this year is due to the shortage of semiconductors, and has already reached 1.34 million vehicles as of Sunday.

The shipment crisis is also getting worse. In the case of Kia Sorento Hybrid and Sportage Hybrid, it takes over 18 months for a customer to receive a vehicle, while the Carnival takes eight to 11 months, the Niro Hybrid 11 months, the K8 six to 13 months, the K5 five to 11 months and Bongo four to 10 months.

Hyundai customers will also have to wait more than 12 months to receive their GV60, GV70, IONIQ 5 and Porter EV vehicles.

"Recently, the production of vehicles has been delayed due to the lack of supply of semiconductors and parts, so the number of backorders has increased," an official at a local carmaker said on condition of anonymity.

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