RV sales price for two consecutive quarters: 70 million won for Hyundai, 60 million won for Kia
The operating rate of major factories in Korea, the United States, and Europe exceeds 100%.
Hyundai Motor Company and Kia Motors’ overseas average selling price is soaring due to high exchange rate and fair price policies. The average selling price of recreational vehicles (RVs), including sports utility vehicles (SUVs), remained above 70 million won for Hyundai and 60 million won for Kia for two consecutive quarters.
According to the third quarter report of Hyundai Motors (005380) and Kia (000270) on the 14th, Hyundai Motors’ average overseas RV selling price in the third quarter was 70.93 million won. It fell by 1.64 million won from 72.57 million won at the end of the previous first half, but remained in the 70 million won range for two consecutive quarters. It was an increase of 3.49 million won from 67.44 million won at the end of last year.
During the same period, the average selling price of overseas passenger cars was 64.65 million won. Overseas passenger use also increased by 1.73 million won compared to the end of last year, and decreased by 1.49 million won compared to the first half of this year.
Kia’s average overseas RV sales price in the third quarter was 60.43 million won, recording 60 million won for two consecutive quarters following the previous two quarters (62.34 million won). During the same period, passenger cars decreased slightly by 890,000 won from 33.47 million won to 32.58 million won. The fact that the average selling price of Hyundai Motors is higher than that of Kia is interpreted as the influence of the premium brand Genesis.
The average domestic selling price of both Hyundai and Kia was cheaper than overseas. As of the third quarter, Hyundai Motor Company’s passenger car sales were 53.13 million won and RV sales were 52.74 million won, up 430,000 won and 1.09 million won, respectively, from the end of last year. Kia’s sales were recorded at 35.24 million won (passenger car) and 48.13 million won (RV), up 1.23 million won and 140,000 won, respectively, compared to last year.
This appears to be the result of a policy of getting the right price in major markets such as the U.S. and Europe due to the high exchange rate approaching 1,400 won per dollar. In fact, Hyundai Motor Company’s flagship SUV Tucson is sold in the U.S. more than 20 million won more expensive than in Korea.
The highest operating rate was Hyundai Motor Company’s Turkiye plant, which reached 123.4%. The Turkye Factory produces European strategic car models such as the i10 and i20. The production volume of these vehicles in the third quarter was 178,400 units, significantly exceeding production capacity (144,600 units). This was followed by △Korea 109.6% △USA 104.7% △Czech Republic 101.7% △India 98.6% △Brazil 98.5%. Indonesia and Vietnam were relatively low at 60.4% and 48.3%, respectively.
In the case of Kia, the domestic factory operation rate was the highest at 108.8%. Countries such as the United States (102.3%) and Slovakia (101.8%) recorded performance exceeding their production capacity, while Mexico (77.6%) and India (75.9%) remained in the 70% range.
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How do Hyundai and Kia’s domestic pricing strategies compare to their international pricing approaches?
Interview between Time.news Editor and Automotive Expert Dr. Lee Joon-ho
Editor: Welcome, Dr. Lee! It’s great to have you here today to discuss the recent report on RV sales from Hyundai and Kia. The figures are intriguing, especially given the context of the international market. Can you provide us with a summary of the current average selling prices for Hyundai and Kia’s recreational vehicles, and what these numbers indicate?
Dr. Lee: Thank you for having me! The recent report highlights that Hyundai’s average selling price for RVs stands at approximately 70.93 million won, while Kia’s average is around 60.43 million won. Both companies have maintained these prices for two consecutive quarters, which is significant. These high average prices can be attributed to a combination of factors, including the steep exchange rates and their pricing strategies focused on maintaining a premium perception in key markets.
Editor: That’s fascinating! You mentioned the influence of exchange rates. How is the current high exchange rate affecting these figures, especially with the dollar nearing 1,400 won?
Dr. Lee: The high exchange rate plays a crucial role. For instance, Hyundai’s flagship SUV, the Tucson, is sold in the U.S. for over 20 million won more than it is in Korea. This discrepancy suggests that Hyundai is capitalizing on stronger demand and favorable pricing in international markets, while the currency dynamics allow them to maintain higher prices without significantly affecting sales volume.
Editor: It’s interesting to see how the pricing strategies differ between domestic and international markets. What can you tell us about the domestic selling prices for Hyundai and Kia?
Dr. Lee: When we look at the domestic market, the average selling prices are noticeably lower. Hyundai’s average selling price for passenger cars is around 53.13 million won, while their RVs are priced at 52.74 million won. Similarly, Kia’s prices are lower as well, with passenger cars at 35.24 million won and RVs at 48.13 million won. This suggests that both companies are keeping domestic prices competitive to appeal to local consumers, which helps them drive sales volume in a more price-sensitive market.
Editor: Now, looking at production efficiency, I see the operating rates have exceeded 100% in many factories. Can you elaborate on what this means for both companies?
Dr. Lee: The operating rates exceeding 100% indicate a strong demand for their vehicles across various regions. Hyundai’s plant in Turkey has the highest operating rate at 123.4%, which reflects their ability to produce more units than initially allocated. This situation might lead to increased operational strain, but it’s a positive signal of market demand. It demonstrates that both Hyundai and Kia are effectively managing their supply chains to meet this growing demand, particularly for strategic models in competitive markets.
Editor: It certainly paints a picture of robust growth. What does this data suggest for the future of Hyundai and Kia in global markets?
Dr. Lee: The outlook is quite positive. As long as they maintain their pricing strategies and adapt to market conditions, they can continue to grow. Their ability to compete internationally, particularly with premium models like Genesis for Hyundai, is essential. Additionally, the expansion into newer markets with rising demand for RVs can further bolster their sales. Their current performance, combined with high production rates, suggests they are well-positioned to thrive in the global automotive landscape.
Editor: Thank you, Dr. Lee, for your insights! It appears that both Hyundai and Kia are navigating the complexities of the automotive market adeptly. We appreciate your analysis and look forward to seeing how this unfolds in the coming quarters.
Dr. Lee: My pleasure! I’m excited to see how they continue to evolve in this dynamic industry.