This article is by Sarah Chea and read by an artificial voice.
[NEWS ANALYSIS]
Hyundai Motor and Kia stand to benefit handsomely in Europe, thanks to their core competency in hybrid powertrains, as the European Union (EU) rolls back its 2035 plan to end combustion-engine cars, with hybrids retaining enduring favor.
With a 15 percent tariff imposed by the Donald Trump administration likely to squeeze margins in the United States, the automaker is doubling down on Europe, a market it sees as critical.
The European Commission unveiled a proposal on Dec. 17 to soften its carbon-reduction targets for new vehicles, lowering the required cut from 100 percent to 90 percent by 2035. The revision reflects a growing recognition that phasing out internal-combustion vehicles - which still account for roughly 40 percent of new car sales in Europe - within a decade is unrealistic.
Where Hyundai held its ground: Hybrids
For Hyundai Motor, which has long pursued a dual-track strategy spanning both electric and hybrid vehicles, the easing of regulatory pressure in Europe could hardly be more welcome.
Hyundai's sales in Europe underscore the point, as hybrids are consistently outperforming pure EVs. In October, Hyundai sold 6,535 units of the Tucson in Europe, of which 4,699 were hybrids and 1,836 were plug-in hybrids. The Kona showed a similar pattern, with hybrid sales reaching 2,794 units, surpassing the 2,481 EV versions.
Of the 3,635 Kia Niro vehicles sold in the same period, 3,430 were hybrids, dwarfing just 205 EVs.
Hyundai had already been facing pressure due to a wave of low-cost Chinese cars flooding the region. This year, a total of 11.02 million passenger cars were sold in Europe through October - of these, Hyundai and Kia sold roughly 880,000 vehicles, securing only 8 percent market share. The sales were down 2.8 percent from last year's sales, with the market share slipping 0.4 percentage points, according to the European Automobile Manufacturers' Association.
"Recent renewed demand for hybrid vehicles reflects, in part, the decision by Europe and the United States to ease environmental regulations from their original trajectory," said Kim Kyoung-you, a senior research fellow at the Korea Institute for Industrial Economics & Trade (KIET).
"Unlike Japan, which is closely associated with hybrids, or China, which has come to symbolize electric vehicles, Korea lacks a singular automotive identity," Kim added. "But in today's more fragmented and fluid market environment, that very absence may prove to be an advantage - allowing Korean automakers to compete on flexibility and balance."
Hyundai said it plans to more than double its hybrid lineup, expanding from eight models today to at least 18 by 2030.
Second chance for Genesis
Hyundai may also see this as a golden chance for its Genesis luxury subbrand - which has long eyed Europe but repeatedly fallen short - in the absence of sufficient electric lineups.
Genesis recently announced that it will enter France, Spain, Italy and the Netherlands early next year, anchored by its first high-performance production model under the "Magma" banner. Until now, the brand has been sold only in Germany, Britain and Switzerland.
Despite being the historical heartland of premium automobiles, Genesis has been struggling to raise its presence. Genesis sold a cumulative 9,444 vehicles in Europe over the four years from 2021 to 2024, which means its sales totaled just 2,300 or so vehicles per year, or roughly 220 units per month.
Against Genesis's global sales total of 229,532 units in 2024, Europe accounted for a mere 1.2 percent.
"Genesis is committed to establishing a strong regional center in Europe based out of Germany," said Peter Kronschnabl, managing director of Genesis Motor Europe, during an interview with the Korean press when asked about the premium brand's strategies for the European market.
"As previously announced, by 2027 we will introduce hybrid powertrains to our lineup - giving cust...