Hyundai Motor and Kia Motors have issued a recall notice affecting around 1.47m vehicles sold in South Korea, the US and Canada due to engine problems.
The recall affects some 1.19m vehicles sold in the US, 171,000 units in South Korea and 114,000 in Canada.
The vehicles affected are fitted with the company's widely used Theta engine range and include popular Hyundai models such as the Sonata sedan and Santa Fe SUV, and Kia's K5 and K7 sedans and Sorento and Sportage SUVs.
According to reports citing transport department officials in these countries, the defects increase the possibility of a crash.
South Korea's transport ministry said metal debris in the crankshaft case can cause engine damage resulting in loss of power. Hyundai is quoted as saying the defects are due to manufacturing problems rather than design problems.
The recall is expected to cost the two companies over US$200m and comes at a time when sales are slowing in key markets such as the US and China.
Hyundai Motor had previously recalled 470,000 Sonata sedans in the US to replace faulty engine parts, which prompted the company to extend their warranty period.