Motortrend website has published an excellent article on how the war in the Ukraine may impact the automotive industry. MT also delves into how the war may impact Hyundai, Kia, Genesis.
“Europe’s home automakers will be hit the hardest, as supply lines from Ukraine and Russia freeze up while bombs get dropped. However, Hyundai and Kia’s massive manufacturing presence in Russia now presents a huge headache for the Korean group, as well.”
Beyond that, “The Korean automotive sector is hugely reliant on Ukrainian-provided rare gases like neon, krypton, xenon, and more, everything from EV battery cells to superconductors are now on an even tighter supply line, and prices will go up.”
“Hyundai Group, which Kia also operates through, first established itself with a factory in St. Petersburg, Russia, in 2010 and recently purchased a former General Motors facility to renovate for Hyundai Tucson, Palisade, and Kia Sportage production for export to North America and the rest of Europe this year. The automakers combined currently produce more than 230,000 cars annually in Russia.”
“That’s just what they build there—Hyundai Group sold 373,132 vehicles in the Russian market in 2021, holding the largest market share; Hyundai accounts for 10.3 percent and Kia 12.3 percent of Russia’s total vehicle market share.”
“The outbreak of war and the onslaught of economic and financial sanctions against Russia now put all of Hyundai and Kia global business in jeopardy and will severely damage the national Korean economy, as well. The Korea Times says “Korean conglomerates” sold $2.5 billion worth of cars to Russia in 2021, plus an additional $1.45 billion worth of car parts and components.”
“Cars and their parts previously accounted for 44 percent of Korea’s annual export volume to Russia, which will likely be severely hindered by American and European sanctions looking to cut trade and handicap Russia’s economy.”
To read the entire article including much on Hyundai, Kia and Hankook’s position in the Ukraine, click here.