Hyundai: Longer Range, Better Infrastructure Should Boost EV Sales

HOLLYWOOD, CA – Hyundai is moving into the next phase of its alternative-powertrain plans by launching higher-mileage versions of its fuel-cell electric and battery-electric vehicles.

And it wants to see higher sales of each vehicle type than it has realized with prior efforts.

Hyundai’s new Nexo FCEV and Kona BEV can travel 380 miles (612 km) and 258 miles (415 km), respectively, on a full tank of hydrogen or a fully charged lithium-ion battery pack. The former has a range that exceeds many gasoline-powered internal-combustion-engine vehicles, while the latter approaches them.

“It’s going to be way, way more,” says Trevor Lai, manager-product planning for Hyundai Motor America when asked about sales of the Kona Electric compared with the current Ioniq Electric at a media preview here for the CUV.

Hyundai has sold 399 Ioniq Electrics this year in the U.S. It sold 432 in 2017, the year the car went on sale.

Lai says Hyundai hopes Kona Electric sales will be 10 times those three-digit figures.

However, the U.S. sales arm of the South Korean automaker typically has to fight for allocation with South Korea and Europe, and the Kona Electric will be no different.

“We grossly miscalculated demand for Ioniq,” says Mike O’Brien, vice president-product, corporate and digital planning. “And we’re now expanding capacity to address our shortfall. We have to do the same thing with Kona EV. We have to do a better job of understanding demand.

“And of course we have to compete with Europe and South Korea for production capacity,” O’Brien continues. “And we have to make a good case. I’ll be in Korea all (this) week and that’ll be a key discussion point, making sure we get a fair share of production capacity. I can tell you based on Korea, there’s already a move afoot to expand production capacity.”

Lai says the start of production for U.S. units of the Kona was delayed a couple months by incentives in the Korean market that caused Hyundai to build more units for local consumption.

Hyundai is building the Kona Electric for all global markets at its Ulsan, South Korea, plant. The CUV’s 64-kWh Li-ion pack is from LG Chem.

The battery giant has had trouble keeping up with demand, per a leaked Hyundai memo that blamed Ioniq Electric shortages on lack of batteries from LG Chem.

The Kona Electric reportedly already has a wait list in Norway, one of the world’s largest markets for BEVs. Reports over the summer pegged orders for the electric CUV at nearly 7,000 units in Norway, culled from 20,000 total reservations, said InsideEVs.

As with the Ioniq, Hyundai in the U.S. will distribute Kona Electrics to California and the 10 other states (mostly in the Northeast) that follow its zero-emission vehicle rules. Anyone in the U.S. can order one, but if they live outside those states their local Hyundai dealer may not stock the vehicle, O’Brien says.

Meanwhile, he says the growth in hydrogen refueling stations should boost the Nexo FCV’s sales potential beyond that of the outgoing Hyundai Tucson FCEV. Hyundai sold 188 of those in the U.S. from 2014-2018, Wards Intelligence data shows.

There are 35 hydrogen refueling stations open in California and five more slated to open before year-end. Another 19 are expected in 2019.

“Now that there’s more stations and more stations coming, our basic philosophy is to sell the vehicle where the fuel is available,” O’Brien says. “We learned maybe the hard way with the Tucson fuel cell. We sold a few more vehicles than the infrastructure could support.”

Available in the U.S. only as a lease vehicle in California, the Tucson FCEV suffered some backlash when owners took to the Internet to express their displeasure with the unreliable hydrogen refueling infrastructure.

“In the case of a hydrogen station, there’s a longer distance between them, so we had cases where a station would go down and it wasn’t convenient for the customer to get their vehicle fueled,” he says. “We learned to wait until there are several stations in a market before we start selling vehicles in that market.”

O’Brien says the Nexo will be leased or sold like any other vehicle in Hyundai’s U.S. lineup. Sufficient hydrogen infrastructure in the Bay Area, Los Angeles, Sacramento and San Diego will make those markets no-brainers for distribution.

Expected growth in hydrogen refueling stations on the East Coast means the Nexo should expand there eventually, O’Brien says.

Hyundai’s fellow FCEV proponents Honda and Toyota are investors in FirstElement Fuel, a hydrogen refueling company led by Hyundai’s former U.S. lead marketer Joel Ewanick.

Toyota also is an investor in another hydrogen refueling firm, Air Liquide, which recently announced the opening of four stations in Connecticut, Massachusetts, New York and Rhode Island, as well as new stations in California.

Charging infrastructure also is growing. The Kona can be recharged on Level 2, 240V EVSEs (electric vehicle supply equipment) or Level 3 480V DC fast chargers.

The U.S. Department of Energy’s Alternative Fuel Data Center lists 19,346 Level 2 AC or Level 3 DC stations open across the country as of Oct. 12. Some 1,379 are Level 3 DC fast chargers with the standard SAE CCS connector necessary to recharge the Kona.