Hyundai Kona Electric Production Down, But Why?

MAR 17 2019 BY TOM MOLOUGHNEY 116

Production decreased?

Since arriving on the scene in Europe and South Korea last spring, the Hyundai Kona Electric has been the second most sought-after electric vehicle on the market, behind only the Tesla Model 3.

That demand, combined with the lower-than-expected production numbers have contributed to creating long waiting lists, and even what some would consider price-gouging at some Hyundai dealers in the US.

Personally, I’m not surprised that the demand is so strong. I was thoroughly impressed when I attended the Kona Electric press drive last year, and was disappointed to hear the from Hyundai that the US wouldn’t be getting nearly enough to satisfy the likely demand.

However, I was pleased to see Hyundai Kona Electric monthly production numbers raising significantly last fall, and eclipsing the 5,300-unit mark for both November and December of 2018. It was starting to look like Hyundai was going to really try to meet the global demand for this long-range, affordable small crossover. Then came 2019.

Hyundai produced only 3,074 Kona Electrics in January and then a paltry 2,168 in February. Even if you combine production of those two months, they don’t add up to November or December’s production total. So, what gives?

*Image caption – Hyundai Kona Electric production graph courtesy of Thomas Schulzki‎ of the Hyundai Kona Electric Facebook group. Thomas collects the data from the Hyundai Motor Company Investor Relations website, and plots the numbers into this neat graph.

We’re not sure what has caused the precipitous drop in Kona Electric production, but speculation is that it could be a battery supply issue, as that seems to be the bottleneck in the manufacturing of EVs across the industry, with the exception of Tesla. Tesla was smart enough to know that they had to control their own battery supply, or they too would likely find themselves supply-constrained. Since all Tesla sells are electric cars, it was vital to be able to make as many battery packs as they would need, because they couldn’t fall back on ICE sales for their profits, as the other OEMs can.

We’ll be keeping an eye on the monthly production now, as well as reporting the Kona Electric sales in the US on our monthly Plug-In Sales Scorecard, and report back once we have some more monthly info.

What do you think this means? Is Hyundai battery-constrained? Is it just a cyclical production variation because Hyundai needed to make more of their other models in January and February? Let us know your thoughts in the comment section below.

***Note:  These are sales figures, not actual production, because that’s all that Hyundai reports. However, production and sales should be relatively in sync, as we know of no reason why Hyundai would produce thousands of vehicles without moving them to their retail outlets for sale. We’re reaching out to Hyundai for comment.

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116 Comments on "Hyundai Kona Electric Production Down, But Why?"

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In a macro sense, OEMs can penetrate with EVs like this and cannibalize some of their own sales margin, or they can aim at Tesla as its tax-credit dries away this year. Sort of looks like the former is still more feared, than the latter is attractive.

I’d like to a corresponding graph of ioniqs to compare. Or am I even luckier have got my beautiful blue ioniq in feb. built 26th dec so just before the production crash.

Here is the comparison graph for Ioniq EV (AE EV)
https://photos.app.goo.gl/5NqKaKZ9AWHTKpvB7

Or simply they see losing to much money per unit

I guess if the demand for ICE or Hybrid versions of the Kona is strong, they would prioritize making them first (most likely higher profit margins relative to the EV version)

Unlikely, the demand is very strong internationally.

Kona EV is just a regular Kona right, a switch of power train and battery increase the price what $11k and dropping so they are making a profit it’s just they can’t their battery supply up

I love the Kona Electric… great option…My guess is that they are hoping they can move customers to the hybrid while their supply and profit constraints improve… too bad they didn’t plan for success for what is clearly a fine model. Hyundai’s models have been right up there with Tesla on efficiency of operation per mile. They are a fine option if you like buttons instead of touchscreens. Love my Faberge Egg Spaceship Model X!

In the grand scheme Hyundai is company that can afford it and likely doesn’t care. I am betting these cuts are as the writer suggested a supply side issue. Likely an issue that won’t be resolved quickly. Tesla was smart and built their own battery factory in Nevada other automakers that aren’t Tesla and Chevy have to rely on an outside vendor. Technically chevy does too but the LG factory that supplies for the chevy bolt is very very close and purpose built to supply GM.

I doubt this is a case of negative margin making them nervous. Nissan went through this too with the equally low volume Leaf. The leaf has some impressive lifetime numbers but it has been on sale for almost 10 years at one point it also had no real price point competition.

This vehicle is a test bed for Hyundai who is one of the planets largest manufacturers of cargo vessels, steel, now carbon fiber, and also cars. I highly doubt they care about loosing a few thousand a pop on 20k-25k vehicles per year.

Why are they losing money? Could it be, as stated in the article, they don’t control battery supply?

Every automakers besides Tesla is paying out the azz for batteries. That’s why they can’t make any money on EV’s. The more they sell, the more money they lose.

Battery cells and ingredients (lithium, cobalt and so on) are falling in price. There was a large rapport of the increase in cobalt production, resulting in a 60% drop in price over a period of less then 12 month. We’ll see a slow and steady drop in cell prices, together with a production volume that is really on the way up.
Hyundai could of course have ordered too few batteries, and they may have. . but after the Ionic, they should have seen the trend, so the new EVs should have significantly higher battery orders.
I read in a magazine that Hyundai was making assy’ line adjustments, and the report also indicated more production equipment would be installed. I’d think, and hope – that they’re making adjustments to the line in order to increase production. They may run the line slower during this periode, or stop it several hours a day. . and perform adjustments.
If it is a supply chain problem, it is a management problem, and they should really shake up their PL department.

I was wondering that as well. Not necessarily that they were losing $ but that their profit margin for Kona was sinking because too many EV vs ICE version. If you sink your margins, stock holders revolt.

Most of the plunge is domestic. Is there a seasonal effect in S Korea which peaks in Nov?

Exports in Jan and Feb aren’t that different from Oct and Nov.

The waiting list in some contries is up to a year long. I cant imagine them not delivering to those countries if demand at home dropped.

I wanted one but couldn’t wait forever so I moved on.
How does the production of the Kona compare to that if the Niro EV? They’re basically the same car so if supply issues would be a problem we would see it there as well?

Not 100% sure but I read it’s different suppliers.

Yes, see my comment above.

Most EV sites wrote that the two drivetrains were identical, but according to this
https://electricrevs.com/2018/12/20/exclusive-details-on-hyundais-new-battery-thermal-management-design/
the batteries for the Niro & Kona are made by two different suppliers, SK Innovation & LG respectively; that could well mean that the supply situation is different.

Compliance Car.. Building only as many as needed for “Compliance Reasons” . Also I suspect a possible battery shortage issue that does not enhance the situation ….. 🙁

If it’s compliance car, why would they sell more outside of US compliance states? Heck it was sold outside of compliance states only (not available in compliance states) and people like you still call it “compliance car” By your logic, all Tesla cars are compliance cars since they sell ZEV credits.

Yep. And if it’s a compliance car, why would H/K invest in designing and marketing so many models of compliance cars?

Name a single Hyundai / Kia car that’s only sold for compliance reason (ie, sold only in compliance states). There isn’t one. If you mean they also sell in compliance states for ZEV credits, so does every Tesla.

If that’s the case, then why the dealer mark up over msp in the ZEV states?

It seems like it’s more then just a ZEV state issue, since there is a long wait time in Europe as well.

High demand = higher cost.

Tesla cars are not compliance cars per se, but Tesla as a company surely benefits from the “legislation”.

And Hyundai / Kia are not compliance cars, either, since they sell outside of compliance states. In fact, unlike Tesla that sell in compliance states first, Hyundai sold OUTSIDE of compliance states first, making them less of compliance cars than Tesla.

It’s a compliance car because they’re not building enough to meet demand. Simple as that.

On that basis the Tesla model 3 is a compliance car on a global scale. Your definition doesn’t work.

The difference is Tesla is *trying*. Hyundai is clearly not.

So Ferrari makes almost exclusively compliance cars?

Bugatti must be the king of compliance then.

Yeah right I don’t know if your joking but Tesla sells more EV’s than anyone. But the shorters say demand isn’t that strong or that other manufacturers are going to take market share. The truth is Tesla is a leader in sustainability. This year we’ll see not only strong sales of Tesla EV’s but also solar roofs, Powerwalls and Powerpacks.
Demand is so great for Tesla products and EV’s only have 2% of marketshare so 98% of ICE is what EV’s are after.
Also the wholesale price of gasoline has gone up from a low prior to 2018 election by 50% now. This will make more people buy EV’s.

That’s a dizzying set of logic there.

You’re an idiot.
Compliance car :== car that is made simply to comply with regulations, despite the fact that it doesn’t make money for the carmaker in itself, or helps sell other cars (like halo cars do).
The Toyota RAV4EV was a compliance car — Toyota needed to make a certain number (2600) to be allowed by the CARB ZEV laws to continue to sell cars in California, made & sold 2601 of them, and then stopped production.
(And Toyota stated this explicitly — they didn’t pretend otherwise.)

The Fiat 500e is also a compliance car — it isn’t sold in Europe despite the fact that the ICE Fiat 500 is quite popular there as is the rest of its segment — it is sold in only 2 US states, both CARB ZEV states. FCA CEO complained loudly, numerous times, that Fiat lost lost money on every car but had to make it to sell cars in the US.

Other countries have their own EV requirements too.

Compliance car and Halo model to draw in customers so they can sell a Hybrid version or simply ICE… the car is solid whatever the powertrain. However the EV version is awesome.
Love my Model X… respect the Hyundai models… now ship more of them!

It’s not a compliance car in a pure sense of the word, but it was clearly intended for the artificial EV market, created almost entirely through government action (EV subsidies + anti-ICE punitive measures) rather than through consumer preferences.

And how do you explain Hyundai made their EV available outside of compliance states first, unlike Tesla that first sell in compliance states? I don’t think Kona is even available in compliance states yet, but they are available outside. People still call a car that’s exclusively available OUTSIDE of compliance states as compliance cars is just crazy.

It’s actually easy. Any company that sells multiple millions of cars a year all of a sudden cant sell more than 35k of something with insane demand? It reeks of an ulterior motive. There are other forms of compliance to meet than CARB credits btw, but you knew that already. Just a troll looking for a technicality.

Comparing them to Tesla is ridiculous and you know it because they sell every EV they can possibly build. They don’t play these stupid games of only selling a few so the tax credit stays marketably higher while they wait for the competitions to phase out.

Shouldn’t you be commenting on a Dodge Challenger web site? “… artificial EV market” and “Anti-ICE punitive measures” sound like a Trump discussion with Fox and Friends.

Yeah, he’s obviously an EV hater, only posting here to troll.

Like the subsidies that the fossil fuel industry gets a profitable industry still needs subsidies after over a century in existence.

Hyundai can satisfy its CARB requirements by selling just the Niro PHEV and Optima PHEV. Under CARB regulations, Hyundai is an “Intermediate Volume Manufacturer,” and therefore, is NOT required to sell ZEVs in CARB states. To comply with CARB regulations “Intermediate Size Manufacturers” need only sell PHEVs in CARB states. Under CARB, PHEVs are TZEVs (Transitional Zero Emission Vehicles). But the Niro BEV would yield more CARB credits per vehicle than the Niro PHEV and Optima PHEV.

§1962.2(b)(3) reads as the follows:
“(3) Requirements for Intermediate Volume Manufacturers. For 2018 and subsequent model years, an intermediate volume manufacturer may meet all of its ZEV credit percentage requirement, under subdivision 1962.2(b), with credits from TZEV.”

See page 3 for §1962.2(b)(3):
https://www.arb.ca.gov/msprog/zevprog/zevregs/1962.2_Clean.pdf

I hate stories like this with little facts. Tesla does not “control” their own battery capacity – Panasonic does. Tesla has a contract like all others for Panasonic to produce a certain number of cells. What we do know is Tesla has a contract with Panasonic to produce enough cells to meet their needs. If Hyundai/Kia signed a contract with LG to produce cells for 30k packs – guess what they’ll get 30k packs. If they now need cell for 60k packs that’s a new contract and it’s up to LG expansion abilities and capacity to meet the additional demand.

None of this is magic and Tesla doesn’t have some secret ability. Tesla was willing to sign a big contract and Panasonic was willing to accept it.

Tesla also paid for the building and services, which reduced Panasonic’s risk. Also, the contract includes provisions for expanding production. Both companies must agree to add capacity, but it’s faster and easier than negotiating an entirely new contract.

If you have been waiting for a PowerWall you know that even Panasonic can’t keep up with demand, regardless of the advance notice. They have known that they needed to plan for 400,000 M3s since 2016 as well as projects like the Australian virtual battery project. Imagine if the Model 3 roll out hadn’t been so difficult.

VERY strongly agree with your first sentence. There is way too much speculation re:EVs on various web sites based on minimal or no hard data. I’m almost surprised that this article doesn’t include a speculative render of what a next-gen Kona might look like if there were a sold state storage breakthrough in 5 years.

Honestly, it’s OK to report on the underlying facts in a simple, straightforward way without speculating.

Tesla manufactures all battery packs itself. Panasonic only do battery cells in the Tesla facility. Even that Tesla helped to design the line. Those equipments were made by Tesla’s German automation subsidiary Grohmann Engineering. Tesla also controls the cell design and chemistry. It has a very respectable battery reaserch group lead by one of its founders and long time CTO. Plus other facts like its research contract with top battery researcher Jeff Dahn and recent purchase of dry electrode technology company Maxwell. It was Tesla not Panasonic doing all those things. Tesla indeed have a lot of secrect abilities.

Tesla could go to any partners as it’s in talk with companies now for battery production in the new China gigafactory. It could do the manufacturing itself if it choose to too. The only consideration is probably they might not want to put up the capital investment but who knows.

Machines that build packs are very different than the clean room like environments that build cells.

“Tesla also controls the cell design and chemistry.”

You’re overstating the case. Yes, Tesla now has its own battery R&D research group, but that’s a fairly recent development. The improvements in li-ion cell chemistry in the years since the original Tesla Roadster went into production owe much more to Panasonic than to Tesla. I have no doubt that Tesla’s researchers and engineers contributed to the design of the 2170 cell, but I’m also sure the actual design of the cell was produced by a partnership between the two companies.

It’s not like Panasonic is just a subcontractor building a battery cell to Tesla’s design and specifications. I’d say there’s a real question who contributed more to the 2170 cell design — Panasonic or Tesla. My guess is Panasonic; they have the experience, and Tesla doesn’t.

Did you see the part I mentioned one of its founders and long time CTO J. B. Straubel is a battery expert? Tesla has had the most advanced battery technogy since the day one. If Panasonic owns that design why it did not sell the same cells to other EV companies and likely could take over the entire market.

Tesla is free to take the design to anyone else and apparently it is about to do exactly that. Not only rumors of it is talking with Chinese and Korean battery companies did you notice Panasonic in its financial reports never could say Tesla will partner with it for the China gigafactory?

Doesn’t change the facts which are that Tesla is currently the only manufacturer that can produce batteries in volume.

“Tesla does not ‘control’ their own battery capacity – Panasonic does.”

Regarding the 2170 cells produced at Gigafactory 1, that is factually incorrect. Tesla, not Panasonic, sets the level of production at Gigafactory 1. Tesla, not Panasonic, contracts for raw/ precursor materials to be delivered to the factory.

That’s not to say that Panasonic has nothing to do with it; it’s up to Panasonic to achieve the production goals that Tesla sets. Apparently Panasonic has sometimes lagged behind that, albeit temporarily.

The business relationship at Gigafactory 1 is a true partnership between Tesla and Panasonic. It’s a symbiotic relationship; both need the other. But Tesla sets the level of Gf1 production for battery supply, not Panasonic.

Now, you could rightly say that Panasonic controls the production of the 18650 cells which Tesla is still using in the Model S and Model X. But I suspect that won’t continue for long!

I have to agree with the author. Battery supply/cost is the simplest and most likely explanation.

How’s their fleet average looking with the reduced volume?

Never forget that car makers are selling EVs to hit regulator’s targets and avoid punitive taxes first, and to prepare for the day when the car business is about electric cars second. They don’t make money on EVs, so they have no reason to satisfy demand. Tesla of course is the exception; they don’t really make money either, but they have no existing, profitable ICE business to protect. ALL of their business considerations are about the future, and that means what’s rational for Tesla is quite different from what’s rational for Hyundai.

The battery supply explanation seems weak since car makers and battery makers have explicitly denied it many times. For some reason I suspect this publication would have been taking a closer look at the alternative explanation outlined above if it wasn’t completely dependent on advertising revenue.

“The battery supply explanation seems weak since car makers and battery makers have explicitly denied it many times.”

You are confusing PR and spin with reality.

Here’s a relevant quote about the reality:

The model for success is shown with Tesla. Carmakers must enlist battery expertise and partner with a battery company in an exclusive arrangement where they benefit from factory output. Failing to do that is like a conventional car company failing to own an engine factory or have any significant internal combustion expertise. That would be unthinkable.

“The situation is summarized in the following statement from a VW exec. “Quite frankly, if we compare ourselves today with Samsung and LG they are light years ahead of us,” VW Group’s Thomas Sedran, head of global strategy, said.

https://cleantechnica.com/2018/08/12/electric-car-growth-produces-battery-shortages-carmakers-cant-match-production-with-demand/

No one has been saying the problem was batteries. The problem has been cells. There are clearly not enough cells to go around. The OEMs can make batteries if they have cells, but if you add up known and planned cell production, there are simply not enough to go around.

My suspicion is that TM3 shifted the demand and Hyundai found that they cannot sell for full MSRP (and more) pretty soon. If they scaled up production to meet existing demand, they’d have to cut back later and cost more money to produce fewer cars. They might as well cut production now instead of up-and-down.

Haha dude then why do you have year-long wait list in Europe?

There’s no base TM3 in Europe, yet. Once low cost TM3 becomes available, that wait list will disappear, replaced with cars sitting on lots with heavy discounts. Think of it this way; you can get flashy Tesla badge along with better performance and glass roof, or you pay more to get just another econobox Hyundai.

You seem to ignore the fact that one is a Sedan (not so popular) and one is a Hatchback (vastly more popular) and … etc etc.

No such thing as car lots in Europe. Cars are made to order only.

Yes just look at how Bolt sales faltered after the initial strong demand. I was sort of considering the Bolt or the Kona but I don’t see any reason for it now that the base TM3 is available. It is much more of a car and above all a Tesla.

Currently, Bolt is significantly less expensive than the Model 3. With GM offering more than 10% off, and still qualifying for $7500 back.

I still have until end of the year when my current lease is up to make the decision. I could get another Leaf too but the TM3 is just so much more of a car it’s still very attractive even if it might cost a little extra.

With all that discounting AND bigger tax credit on Bolt, they are still sitting on dealer lots. Actually, they were sitting on lots even before base TM3. That’s why I think Hyundai situation is even worse when they’re trying to squeeze full MSRP.

GM dealers (and maybe GM itself) try not to sell BoltEV.

Plus, GM did say that they would be increasing Bolt EV production, right?

Markets that shift to EV do it in huge numbers. Noruega EV’s market is around 40%-60% and Holland is following the lead. With such a big and fast switch there is no problem with demand. All SR M3 will be sold and people waiting will buy Kona EVs. That is not the problem at all.

As you say, probably a battery supply issue. In any case, the Kona has only room for four, with a very cramped back seat, and a range of under 300 miles. “Good,” but not great. I have an order in for a Model Y.

Don’t forget the “no dealerships” benefit for Tesla, as well as the robust fast charging network, performance and superior screen in the car… lots of good reasons to go Tesla.

Is this related to the increase in the Niro EV production? Since the two cars share the powertrain and are both unprofitable, maybe Hyundai/Kia just want to cut their losses.

Then why do i keep getting e-niro ads on youtube?

I keep getting Audi e-Tron ads, that doesn’t mean they want me to buy one – since none have been shipped to the US.

For an extra 15-20K more than a gas Kona, how many years would it take to recoup the extra $$$ anyway?

You to look at comparable trims. The Kona EV is well appointed inside, and has more torque, and horsepower, and quicker than the Kona Limited trim with the turbocharged engine. So really only about $10k more. Then in the US you can get back $7500, and in the states where it will be sold, even more back. So it’s about the same or possibly less than the gas counterpart.

I just checked their website and the EV carries a $14,000 premium. Or $6500 after the tax credit. Assuming 15,000 miles a year break even is about 7 years. Assuming you put NO benefit to cleaner driving.

It’s pretty evident here (Portland, OR). There are exactly four Kona EVs listed for sale right now (starting at 42k), vs 272 Bolts (starting at 30k). It’s apparently a better car than the Bolt, but 12k better? Is it 7k better than a base TM3?

Also, it’s “price gouging”, not “price gauging”.

Why haven’t you asked Hyundai instead of your readers? Seems the logical first step to solving the mystery.

We are reaching out to Hyundai.

There’s going to be official word and there’s internal memo. I doubt they’ll disclose that it’s due to possible lack of demand in the future if that is indeed the case.

Yup. Few if any auto makers are going to put out an official statement admitting they have a problem with insufficient battery supply. Quoting from a CleanTechnica article: As an example, in 2017, Hyundai encountered unanticipated demand for the Ioniq EV and was unable to satisfy the demand. But the lack of production capacity was related to a global issue, not just a Hyundai issue. The problem was Hyundai didn’t have enough batteries because LG Chem didn’t have enough batteries. What seemed to be admission of the main cause was leaked in a company memo. The bulletin was originally posted to the IoniqForum.com website on April 21 by user “LLcoolB” from Ottawa, Ontario: “Over the 12 months since sales of the Ioniq Electric in the United States began in March of last year Hyundai sold only 544 of the cars despite an apparent backlog of pre-sale orders. “Now, a premature ordering halt has been announced in a sales bulletin to dealers due to a Hyundai ‘temporary global battery supply shortage’ apparently from their battery supplier, LG. “It now appears as though demand for the IONIQ Electric is far higher than anticipated. As a result, Hyundai is attempting to increase production… Read more »

Could be they are trying to get rid of the ICE and hybrid inventory by discouraging and diverting EV prospective owners. Although, that would be a very shortsighted attitude

Could you include the Kona PHEV as well as Niro EV?

One hypothesis is in a battery shortage, they are sacrificing 1 BEV to make 3-4 PHEV.

I am not sure you can use the same cells for PHEV and EV although cell production capacities may overlap between the two kinds

PHEV cells should have much higher power densities while EV cells primarily need high energy density since due to the big pack lower power density still results in high enough power.

Certainly, Hyundai has to take pause and say how do we compete with the $35k Model 3? Will the Kona be perceived as a comparable value to the Model 3? Right now, we have the tax credit advantage. Where can we and where do we want our product to compete? Until the announcement of the $35k Model 3, I was trying to find a Kona to buy. Now, I am buying a Model 3.

@Tom
I would think a car maker like Hyundai or Kia who has been in car manufacturing business for quite some time would consider something like that prior to marketing their EV’s for the US market. All other makers of EV’s had to be prepared for Tesla to come out with the long awaited $35,000 M3 and plan ahead on how they can compete with that price level once the tax credits for their models will have ended. In my opinion, I actually don’t think the car makers do take the tax credits much in consideration at all other than it is an additional benefit or way to jump start selling EV’s.

Kona should be a hybrid. I was waiting for it to come out. Disappointed it’s all electric. The world is not physically ready for plug ins. We need great SUV hybrids. The Kona is a beautiful car, but its electric.

I think a few hundred thousand Tesla owners and a few hundred thousand owners of other EV’s may well disagree with you about the need for PHEV’s over BEV’s.
I’m just about to move from a PHEV (Outlander) to a BEV (Niro) so you can add my vote to those who think you are wrong. In my area there are now 6 50kW DC chargers. A year ago there was 1. I also charge at home.

Electric is by far the best. I’ve been driving EVs for six years, and I’d never go back.

A Kona Plug-In Hybrid is on the way as well. The Niro comes as a hybrid, plug-in hybrid, and battery-electric.

What are you on about? Do you mean because K/H doesn’t have a supercharger network?

I’ll be charging my LR 3 in my garage and up to 80% in 20 minutes on road trips. Piece of cake. 🙂

What I think is that Hyundai/Kia is battery-production constrained. And since the sales of the E-Niro are picking up, logically they can not build as many Kona as they used to before the release of its sibling. Could you draw a graph of the combined sales of Kona and E-Niro ?

Lol. All Tesla shorts have been talking ip the competitors. But as I’ve said for months, even if they manage to come up with a decent design (like this Kona), no one can build large numbers of them.

Everyone dragged their feet until Tesla swallowed up a big slice of the premium car market. Now they are all scrambling. Meanwhile, Tesla is full speed ahead building a Shanghai gigafactory and expanding Sparks, Nevada.

This, nailed it Spec!

I’ve been told mines on the boat due to arrive on the 27th March looking forward to it after waiting almost 6months. Had to make do with my Ioniq EV while waiting.

Not enough batteries? No heart in it?

Winter.

If these are rolling off the same production line as other, more profitable cars, (e.g petrol Konas, hybrids etc) then logically they are scaling back production of the electric Kona to make more money on other things.

Not sure why my previous reply hasn’t made it yet.

This story is incorrect – the figures quoted are SALES not production. Sales are down because they’ve stopped taking orders. I’m afraid this entire news story and thread is fake news…

We talk about both sales and production. We added a note at the bottom and are reaching out to Hyundai for more information. No matter how you look at it, numbers are down significantly over the past two months. Hopefully, the automaker can explain why. Sales shouldn’t be down if demand is through the roof, unless production is not keeping up. The two go hand in hand. If the automaker was producing 50 percent more vehicles instead of 50 percent less for two months in a row, sales would also show the increase. When we have more information, we’ll either update this article or publish another with a statement from Hyundai.

But as it stands, your article is wrong – it shows sales figures as production figures which is incorrect. At the very least you should correct the article as it’s misleading. Sales are down because they have stopped taking orders while they clear the backlog, that’s all.

That only makes sense if “orders” and “sales” are basically the same thing, and a car is counted as “sold” long before it is actually built. Given that in the UK orders were closed because estimated delivery stretched into next year, it would imply Hyundai is counting cars “sold” that they don’t expect to make for at least nine months. That seems highly unlikely.

By a more normal definition of “sales”, if there is a big backlog, stopping taking orders won’t have any effect on sales until the backlog is cleared. Sales rate should only reflect manufacturing rate in these conditions, or number of vehicles in transit if a sale is not counted until the car is in the hands of the dealer or customer.

Those numbers are not end customer sales, but produced cars sold to retailers – several thousand cars where “sold” in July and August only in Norway – most of them are not delivered yet. If you want end customer sales, some of them are available for certain markets.

It makes no sense to have a higher production than sales when you have a huge order reserve.

So for all practical purposes, theses are the actual production numbers for each month for the Kona EV.

I’ve been tracking the numbers since August 2018 – and there is a direct correlation between these numbers,and end customer delivery to the Norwegian market- but approximately one month delay (shipping).

This a sign of the auto industry’s addiction to horizontal integration. Big auto is like a giant, slow moving ship. Its dependent on a handful of parts suppliers that traditionally make parts for ICE vehicles. They are trying this EV thing and realizing there are only a few battery international suppliers that can supply to scale, now its just LG Chem and Panasonic. Nissan has AESC and the Chinese have BYD and CATL, they are not going to play nice and share… so everyone is stuck. Law of supply and demand, too little supply, too much demand.. LG Chem is going to raise prices for their batteries. Everyone is losing money and it does not make any sense to scale up if you are going to lose more money in the process. If Tesla can scale up to have excess cell capacity, they need to get in the game of supplying cells, corner the market and start overcharging for them… this can be a huge revenue source and way for them to control the prices for their competitors. This probably will never happen as Elon is to altruistic.

Yup. It should have been obvious to everyone in the industry, and industry observers, that auto makers making plug-in EVs were going to have to control their own battery cell supply, for the same reason gasmobile makers have to control their own ICEngine supply.

It amazes me how much argument I got in previous years when I claimed that auto makers were going to have to partner with battery cell makers, as Tesla has, to build out high-capacity battery cell factories, so that auto makers can control their own cell supply. Relying on commodity cells sold on the open market just ain’t gonna cut it, at least not outside China, where battery cell makers are probably highly subsidized by the government.

Perhaps legacy auto makers have been in denial about the reality of the situation. But it looks like reality is finally sinking in.

I told you, they don’t like to sell EVs. Please stay on course with Tesla, BYD, Renault and these 3 companies are dedicated to selling EVs.

Hyundai are grabbing defeat from the jaws of victory, if they dont get their act together toot sweet , they may become the textbook example of how to screw things up

“…speculation is that it could be a battery supply issue…”

That was my first guess, and I don’t see that the article offers any evidence to support an alternative theory. Doesn’t necessarily mean it’s right, but certainly there is a significant shortage in EV battery supply, and that will almost certainly last for at least a few more years.

Kudos to Tesla for foreseeing this problem, and committing the resources and funding to make sure they wouldn’t be significantly limited by battery supply.

Let’s see how long it takes for other auto makers to follow suit. Those which don’t, probably won’t be selling cars in large volumes for many more years.

Hi there: I was in the market for a new vehicle, particularly the Hyundai Kona electric, then I went to two different dealerships, where they had 5 and 2 Kona EV. Everything was sweet and smooth until the manager came up with a exaggerated market adjustment price, way up any reasonable offer, how much? $10K.
After the horrible experience with the voracious sales men, I told them that Teslas are cheaper and was going to get one instead.
As of today, their expensive Kona EV are sitting there with no one interested in buying one.
Instead I got a Volt, pretty straightforward purchase, and reasonable price.

Each EV is sold at a loss. That’s why less sales lower losses

Maybe it is that they are trying to insure that the battery power last’s long enough, it’s either that or it be a marketing strategy, to see how in demand they are and to see how many MORE would need to be in production moving forward…

It exemplifies the fact that car manufacturers, other than Tesla and a few others, don’t even want to sell EVs. It’s that simple.

I talk from memory so I might be very wrong. Some months ago LG Chem rose up battery prices to VW (I believe to remember it was VW and I believe to remember it was LG Chem). At that time it felt like LG Chem was telling VW that if they were not going to trust LG Chem for the long run it did not make any sense for LG Chem to sell them batteries at a reduced price. Now I think maybe they were battery production constrained. It might be that batteries demand has risen from new players, such as new Leaf and Zoe. Maybe LG Chem did have spare batteries last year, as long as Leaf and Zoe and others have been late to be produced, so LG Chem could sell those batteries to Hyundai. But now that production of those other cars has started, the amount of batteries in the market has fallen down and Hyundai has been affected.

LG raised the price to Audi by 10%. Then they threatened to withdraw the multi billion contract from VW if it did not seize approaching other manufacturers.
Battery supply not secured…

This is pretty frustrating. Having been on the Tesla model 3 waiting list for years and now unable to buy one due to the country where I live imposing 120% import tariff on US cars. Why don’t Hyundai just have a single waiting list for all left-hand-drive countries and let anyone join it?