Busy Days in Hyundai and Kia Dealers Service Bays

Service departments at Hyundai and Kia dealerships are getting a flood of work lately but not for a good reason. They are installing a software upgrade for vehicles in which the manufacturers failed to install an engine immobilizer.

Those vehicles have been stolen at extraordinarily high rates after a social media video revealed they could be started using a USB cable.The National Highway Transportation Safety Administration (NHTSA) blames a TikTok social media challenge for the theft increase that could impact up to 3.8 million Hyundai and 4.5 million Kia vehicles.

“Ever since (reports of the thefts) started, customers have been asking about whether Hyundai was going to do anything to fix the problem (and) if they were going to do an update,” says a service writer at Lithia Hyundai of Anchorage in Alaska who asked not to be named

Although nationwide statistics are not available, thefts of Hyundai and Kia vehicles in Minneapolis increased 836% in 2022 compared to the previous year, according to a March 20, 2023 letter to the two brands’ manufacturers signed by the attorney generals of Wisconsin, Arizona, California, Colorado, Connecticut, Delaware, Illinois, and the District of Columbia.

The California State Attorney’s Office reports thefts of Hyundai and Kia vehicles increased by around 85% in 2022 and accounted for some 20% of all stolen cars in Los Angeles in 2022, up from 13% in 2021. The most at risk Hyundai and Kia models are those with key (as opposed to key fob) ignitions from model years 2011 to 2022. Those models do not include software that prevents the vehicles from starting without a key.

Hyundai has “expedited” the rollout of the free anti-theft software upgrade, which is performed at one of Hyundai’s 830 U.S. dealerships in the U.S., says a Hyundai spokesperson.

Owners of a subset of 2011-2022 models which cannot accommodate the software upgrade will be reimbursed for the purchase of a steering wheel lock, says Hyundai.

In an April 20 press release, California AG Bonta rejected the manufacturers’ efforts thus far and said: “We now ask the federal government to require these companies to correct their mistake through a nationwide recall ….”

Sixteen additional state attorney generals as well as the attorney general of the District of Columbia joined the call for a recall.

Insurance denied

The thefts have become so widespread some insurance companies have refused to insure impacted vehicles are reluctant to insure even those Hyundai and Kia vehicles with fobs.

In response, Hyundai is working with “independently operated” AAA insurers to offer insurance options to those vehicle owners, says the Hyundai spokesperson.

AAA does not sell insurance in Alaska, Washington state, and Massachusetts. Owners in those states are not eligible for the AAA insurance and Hyundai has provided no other insurance option.

Kia models are not included in the offer.

Media coverage notwithstanding, the anti-theft software issue does not seem to have impacted consumers considering Hyundai or Kia vehicles, Ed Kim, president and chief analyst at consultancy Auto Pacific Inc. tells Wards.

“We haven’t tracked any brand consideration reduction in Hyundai or Kia as a result of this,” he says.

However, it may impact buyers who consider purchasing used Hyundais or Kias, adds Kim.

 “We don’t track (used consideration),” he says. But, “if I was a used car shopper looking for a good pre-owned vehicle, I might steer away from those (affected) models.”