High prices appear to be killing Hyundai Motor’s i40 mid-sized station wagon, which the automaker spent KRW230bn developing to compete with European rivals, in South Korea.
Since launch last September, monthly sales have averaged just 705 units. Even though the i40 belongs in a segment that is hugely popular among Korean consumers, sales are even lower than for the large Equus sedan, the Chosun Ilbo newspaper said. What seems to be putting consumers off is not the relatively unfamiliar station wagon format but the high price tag. The diesel versions cost KRW26.95-32.45m and the most popular trim costs KRW30.05m which puts the car bang in the middle between domestic and imported vehicles in terms of price.
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The Volkswagen Golf, a hot-selling import, costs KRW31.4m, the Mini at least KRW29.5m, and a nondescript Honda Civic KRW26.9m. A Toyota Camry costs KRW33.9m but just KRW30m on special offer. That means a potential car buyer with KRW30m to spend has a wide range of imported brands to choose from.The i40 also competes with other Korean brands. The 2.4-litre version of the large Hyundai Grandeur sedan costs just KRW430,000 more. An NF Sonata, which has the same platform as the i40, can be had for KRW1.85m less with full options. The i40 may be armed with a high-performance diesel engine, but the latest Santa Fe boasts similar fuel efficiency, and a two-litre premium model costs just KRW30.08m.
“Increasing demand for imports and availability of versatile models with lower prices has moved the competition with imported cars even into the KRW30m price range,” admitted a Hyundai executive. “We plan to focus on the i40’s uniqueness, which is what imported car dealers are doing with their models.”
