South Korean car maker Hyundai Motors is reaping the benefits of its partial switch to electric vehicles, becoming the only major legacy auto maker to turn a positive stock market return to date in 2020.
In terms of share price fluctuations for 2020 so far, Hyundai is second only to EV juggernaut Tesla, which is now worth more than $US400 billion, more than Big Oil, and more than twice that of the next most valuable car maker, Toyota.
Tesla and Hyundai, as well as luxury sports car brand Ferrari, are the only car companies to buck the trend in the wider market of slumping combustion vehicle sales, which has been further exacerbated by the Coronavirus pandemic.
While Tesla’s stock has been going through the roof, quadrupling in value since the start of 2020, Hyundai’s gains have been more modest with a 29.5% increase since the start of 2020.
But if market fluctuations are a mark of heading in the right direction – at least for investors, who are increasingly concerned with ESG stocks, as reported by CNBC – then it would seem Hyundai is doing exactly that.
The most significant 15.6% jump came after Hyundai announced it would produce an entire electric series using the Ioniq name.
The new Ioniq series, based on the car maker’s successful electric hatchback which is one of a handful of electric cars in Australia available for under $50,000, will include an Ioniq 5 mid-sized crossover to be debuted in early 2021, an Ioniq 6 sedan based on the Hyundai Prophecy concept in 2022 and the Ioniq 7 SUV, scheduled for early 2024.
Hyundai has an ambitious plan for its electric range to account for one in 10 cars sold globally by 2025, a fact which David Leggett, automotive editor at consultancy GlobalData, says is a big part of the positive return picture.
“Hyundai does seem very ambitious. I think the Ioniq brand announcement just kind of solidifies a lot of what Hyundai has been planning to do,” Leggett told S&P Global.
Leggett gives Hyundai credit for creating a solid electric image with the Ioniq name.
“Bringing the product action together under one new brand is probably quite a smart idea as VW has done with the ID in terms of getting it front of mind for potential buyers,” Leggett said.
While Volkswagen’s e-Golf has been very successful in Europe, it has had experienced delays with the launch of its first ID series vehicle, the ID.3 due to software issues.
Nevertheless the “one name” strategy is certainly less confusing than, say, that of Mercedes-Benz, which has denoted an “EQ” version will be created to correspond with each of its segments.
S&P Global notes that Hyundai’s 34.3% stake in fellow South Korean car maker Kia, which produces all-electric versions of the Niro and Soul, allows it to further defray costs if it shares its “E-GMP” modular electric platform across both brands.
Both also benefit from having some of the world’s largest EV battery makers on their doorsteps in the form of LG Chem, Samsung and SK Innovation, S&P Global notes.
What will happen to the Kona Electric (the second most popular battery electric vehicle in Australia behind the Tesla Model 3) alongside Hyundai’s newly formed Ioniq series is as yet unknown.
While the company teased a sharp new design on Wednesday for the 2021 Kona range, a spokesperson for Hyundai Motors Company Australia (HMCA) told The Driven that it was “too early to talk about the EV variant at this time”.
What is clear is that development for the Ioniq 5 – promised for early 2021 – is already well underway, going by these spy shots captured by CarSpy Media in July:
Bridie Schmidt is lead reporter for The Driven, sister site of Renew Economy. She has been writing about electric vehicles since 2018, and has a keen interest in the role that zero-emissions transport has to play in sustainability. She has participated in podcasts such as Download This Show with Marc Fennell and Shirtloads of Science with Karl Kruszelnicki and is co-organiser of the Northern Rivers Electric Vehicle Forum. Bridie also owns a Tesla Model 3 and has it available for hire on evee.com.au.