Hyundai Motor to Make a New Leap with 'New Cars' in China as Well

New MPV, iX35, Mistra, and More Scheduled for Release
Mistra EV Model Also in Pilot Phase
First Half Performance Decline...Expecting Rebound with Strategic New Models

[Asia Economy Reporter Kim Ji-hee] Hyundai Motor Company is making a comeback in the struggling Chinese market through new vehicles. The company is continuously launching strategic models tailored to local demand while accelerating its efforts to capture the local electric vehicle market.

According to industry sources on the 21st, Hyundai plans to launch a new multipurpose vehicle (MPV) in China around October. Other local strategic models such as the iX35 and Mistra (local name 'Mingtu') are also awaiting release. Additionally, the electric vehicle version of the Mistra, a mid-level model between the mid-size sedan Sonata and the compact Avante, is reportedly currently in the prototype production stage.

Above all, expectations are high for Hyundai's first MPV in China. This model, a minivan similar to the Starex and Carnival, is considered an ambitious project to compensate for the poor performance of Beijing Hyundai, the local subsidiary. Hyundai plans to produce about 60,000 units annually of the new MPV at its Changzhou plant in China, which is regarded as a new production base.

Furthermore, if Hyundai secures an electric vehicle lineup including the representative Chinese strategic model Lafesta and the Mistra, it is expected to respond actively to the Chinese electric vehicle market. China is considered a large market, accounting for about half of the global electric vehicle market. Although the Chinese electric vehicle market has been sluggish this year due to the COVID-19 pandemic and flooding, a recovery is strongly anticipated in the second half of the year. Recently, the Chinese government extended the electric vehicle purchase subsidy, which was scheduled to end this year, for two more years until 2022.

Overview of Beijing Hyundai Changzhou Plant

China is considered the most urgent market for a rebound among Hyundai's major overseas markets. According to Hyundai's semi-annual report, Beijing Hyundai posted an operating loss of 540 billion won in the first half of this year. Following the 370.4 billion won loss in the first half of last year, which was the highest operating loss in 16 years since 2003, the loss increased by nearly 50% compared to the previous year. After a brief rebound following the crisis caused by the Terminal High Altitude Area Defense (THAAD) system in 2017, the performance has worsened again since last year.

It is also concerning that Hyundai's recovery is slow despite the Chinese market quickly emerging from the shock of COVID-19. Since March, the spread of COVID-19 in the Chinese automobile market has gradually weakened, and sales in the second quarter actually increased compared to the previous year. In contrast, Hyundai's sales performance in China during this period sharply declined by 16.4%.

An industry official said, "Hyundai is trying to shift the market focus to India and Southeast Asia instead of China, where it continues to experience persistent sluggishness, but that is not easy either. For now, since Hyundai is concentrating on 'strengthening its foundation' in the Chinese market, it is expected to adopt a sales strategy centered on profitable models that meet local demand."

This content was produced with the assistance of AI translation services.