Hyundai Motor and Kia, 20% Drop in European Electric Vehicle Sales in Q1... Impact of Subsidy Reduction

Hyundai Motor Company and Kia's electric vehicle sales in the first quarter of this year decreased by about 20% compared to the previous year. This is due to the reduction of government support such as subsidies and tax benefits in various European countries as electric vehicle adoption expands.

On the 19th (local time), the European Automobile Manufacturers Association (ACEA) announced that Hyundai and Kia sold 33,831 units in the European market in the first quarter of this year, a 20.6% decrease compared to the same period last year. By model, the Kia Niro EV (8,758 units) and EV6 (8,574 units) were the best-selling vehicles.

Electric vehicles equipped with Hyundai Motor Group's dedicated electric vehicle platform 'E-GMP' have surpassed 100,000 cumulative sales in Europe. The Ioniq 5, which began sales in Europe in May 2021, exceeded 55,000 cumulative units sold, and the EV6, launched in July of the same year, sold more than 45,000 units. In the first quarter of this year, 6,114 units of the Ioniq 5 and 8,574 units of the EV6 were sold. The Ioniq 6, launched at the end of last year, sold nearly 2,000 units (1,935 units) in the first quarter alone.

Hyundai Ioniq 5

As electric vehicle adoption expands in Europe, governments in various countries have recently been reducing subsidies and tax benefits. The German government provided subsidies of up to 6,000 euros for electric vehicle purchases under 40,000 euros until last year, but this year the amount was reduced to 4,500 euros. Subsidies for electric vehicles priced between 40,000 and 65,000 euros decreased to 3,000 euros. Subsidies for PHEVs and HEVs have been eliminated.

Countries with high electric vehicle adoption rates such as Norway and Sweden are also gradually reducing subsidies. The Norwegian government decided to reimpose value-added tax and weight tax (tax based on vehicle weight) on electric vehicles starting this year. Sweden abolished national subsidies for electric vehicles after November last year.

Meanwhile, Hyundai and Kia sold 282,193 units in the European market in the first quarter of this year, a 4.7% increase compared to the previous year. In the first quarter, Hyundai's market share was 4.1%, down 0.4 percentage points from the previous year, and Kia's was 4.6%, down 0.7 percentage points. The combined market share of Hyundai and Kia is 8.7%.