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Hyundai Sonata to give way to Ioniq 6

Automaker will likely cut production of one-time bestseller to maximize electric vehicle capacity


Once the nation’s most popular sedan and Hyundai Motor’s flagship model, the Sonata is apparently losing out to all-electric vehicles as the automaker moves to convert its Asan plant for the production of Ioniq 6.

A number of factors have weighed down the once-bestselling model, including an unsuccessful face-lift and the increasing diversity of alternative models in the market, observers noted.

The automaker is planning to suspend its Asan plant for about a month during the July-August summer holiday season, and may close for another two weeks in November, officials said. Market observers see the planned closure as a preparation for Sonata’s phase-out.

The corresponding manufacturing site -- with a maximum manufacturing capacity equivalent to 300,000 units per year -- is exclusively devoted to the production of the Sonata and Grandeur, the company’s longtime flagship sedans.

“The idea of suspending the Asan plant and converting it into an EV manufacturing facility is still in progress, with details yet to be confirmed,” an official said.

But industry observers largely agree that the carmaker will likely cut production capacity of Sonata, which has been waning over recent years.

Sonata has sold 26,230 units from January to May this year, down 12.3 percent from the same period last year and saw 67,440 units in total yearly sales last year, down 32.6 percent on-year.

The midsized sedan sector in general contracted 13.4 percent on-year during the same period, reflecting the growing popularity of sport utility vehicles as family cars and the rise of battery electric vehicles as eco-friendly solutions.

Hyundai Motor and its sister brand Kia sold a combined of 61,820 midsized sedans during the January-May period, down 13.4 percent from a year earlier.

The Grandeur, however, has performed relatively well, selling a record 145,000 units last year. Taking into account its upcoming face-lift, the sale figure is anticipated to climb further next year.

Meanwhile, the Ioniq 6 -- the sequel of the company’s landmark EV Ioniq 5 -- is slated to be fully unveiled next year, in line with Hyundai Motor Group Chairman Chung Eui-sun’s vow to expand the group’s EV sales volume to the 1 million-unit mark by 2025.

“The Ioniq 6 will be similar to Sonata in size, which makes it easier for the company to convert the production lines,” said Lee Hang-gu, analyst at the Korea Automobile Technology Institute.

Also, the prolonged shortage of automotive chips will be less of a problem for the Ioniq 6 than the Sonata, as the model will be receiving supplies from LG Energy Solution’s domestic plant in Ochang, North Chungcheong Province, which is near the Asan plant, according to the analyst. The Sonata uses chips from various sources, including TSMC in Taiwan.

The Ioniq 5, which is the company’s first all-electric vehicle to adopt an exclusive EV platform, is currently produced at the Ulsan plant but has been facing delivery delays due to the prolonged chip shortage.

Some raised more concerns about the possibility of another round of labor-management conflict down the road as EVs require less labor input than conventional engine-operated models.

Earlier this year, production of the Ioniq 5 was temporarily halted due to union protests in Ulsan.

By Bae Hyun-jung (