Price competitiveness key to Hyundai Motor’s China comeback

Beijing Hyundai's Elexio all-electric SUV / Courtesy of Hyundai Motor

Hyundai Motor’s potential success in China will depend on the carmaker’s ability to release more localized models with competitive pricing, as Beijing Hyundai struggles to achieve a meaningful sales rebound even after its much-hyped launch of the China-specific Elexio electric vehicle (EV) last year, industry officials said Sunday.

Beijing Hyundai launched its first all-electric Elexio midsized SUV in October last year, displaying its renewed signal to widen its footing in the lucrative Chinese EV market.

The vehicle, however, has made little impact there largely due to its ambiguous positioning in terms of its commercial value. The model is struggling to compete against price-competitive Chinese EVs, with just hundreds of Elexio EVs having been sold there.

This has raised concerns that upcoming models from Beijing Hyundai could face similar challenges if their positioning remains unclear — neither distinctly premium nor price-competitive.

According to data from the China Passenger Car Association, Elexio’s monthly sales in China reached merely 221 in November and 228 in December.

Flags of Korea and China fly at a Beijing Hyundai plant on the outskirts of Beijing, Jan. 25, 2019. Reuters-Yonhap

China was once one of the most profitable markets for Hyundai Motor, with its auto sales surpassing 1 million vehicles in 2016, but the figure is on the steep decline. Beijing Hyundai’s auto sales fell to around 180,000 in 2024.

“Chinese EVs offer advanced technology at a highly reasonable price, making it difficult for foreign brands to penetrate into the market,” an industry official said.

“For Hyundai Motor, it will be essential not only to differentiate its vehicles from Chinese rivals, but also to lower prices to secure competitiveness. The Elexio EV looks to have failed to appeal to Chinese customers in both of the elements.”

Hyundai Motor plans to officially launch its electrification strategy for China at the upcoming Auto China 2026, which runs from April 24 to May 3.

Last week, the carmaker held the launch event for its flagship IONIQ EV brand in Beijing, releasing two concept models for local customers. At the upcoming auto exhibition, Hyundai Motor will unveil the design and key specifications for its IONIQ-branded mass-production models in China.

The carmaker will also present its comprehensive road map to tap deeper into the Chinese EV market by covering not just the EV purchase to its after-sales services.

The renewed push to China is in line with Hyundai Motor CEO Jose Munoz’s strong commitment to the market. In a letter to shareholders last month, Munoz shared the carmaker’s plan to introduce 20 new models in China over the next five years, and increase its auto sales to more than 500,000 vehicles there by 2030.

Last year, Beijing Hyundai appointed Li Fenggang as head of its China operations. It marked the first time in 23 years that the company has named a Chinese national as president of the firm.

“The move is widely seen as part of the carmaker’s efforts to strengthen its market responsiveness and better align with local customers,” another auto industry official said.