2016 Kia Forte Lx on 2040-cars

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Why BMWs are cheaper than Hyundais in Korea

Bloomberg reports shifting tariff regulations have upended the traditional automotive pecking order in Korea. Thanks to cheaper import taxes, foreign brands have seen market share jump from 28 percent to 41 percent over the last two years. BMW, Mercedes-Benz and Audi have all capitalized on the shift, with domestics like Hyundai and Kia suffering at the hands of their German rivals.
Taxes on European imports have fallen from 8 percent in 2011 to just 3.2 percent today. Over the next few years, tariffs will all but be eliminated for most imports, and taxes on US-made vehicles are expected to fall to just 4 percent in 2014. By 2016, that number will be zero. Needless to say, Hyundai and Kia are concerned about the shift.
Hyundai has seen profit fall by 15 percent last quarter, and the company says it is on pace to see the slowest sales growth since 2007. The company's shares have fallen by 12 percent. In order to stem the losses, Hyundai has discounted its midsize sedans and started working on diesel engine options.

2021 Kia K5 starts at $25,455, just $100 more than outgoing Optima

The 2021 Kia K5 continues this year's trend of carmakers placing minimal premium on a brand new or heavily revised model. Cars Direct got a look at an early order guide showing that Kia's new midsize sedan will start at $23,490 before a $965 destination charge, for a total of $24,455. The destination fee doesn't change, and the MSRP is but $100 more than the outgoing entry-level 2020 Optima LX. That also puts the Kia $120 under the 2020 Hyundai Sonata SE, $520 under the Honda Accord LX, and $925 below a Toyota Camry SE. The K5 is powered by a 1.6-liter turbocharged four-cylinder with 180 horsepower and 195 pound-feet of torque shifted through an eight-speed transmission, giving it a little less horsepower than the competing trio — the 23 hp given up to the Toyota is the largest difference — but more torque than the other three.   The K5's trim steps have been rearranged compared to the Optima, so instead of LX, S, Special Edition, EX, EX Premium and SX, there will be the K5 LX, LXS, GT-Line, EX and performance-minded GT. The LXS will start at $27,555, the GT-Line at $30,055. Those will be the only two trims offering AWD, and the four-wheel system has late availability as well. Cars Direct didn't mention a price for the EX.   The GT and its exclusive 2.5-liter turbo four-cylinder with 290 hp and 311 lb-ft tied to an eight-speed dual-clutch gearbox will be late availability. The order guide showed that trim costing $31,455 after destination. That's $1,700 less expensive than the less powerful, top-of-the-line Optima SX. Among rivals, only the V6-powered Camrys come close to the K5's output, with 301 hp and 267 lb-ft from a 3.5-liter V6. The Camry TRD stands at $670 more than the K5, butt the only big-ticket extras available for the Camry TRD are two-tone paint jobs costing from $500 to $925. One of the K5 options will be a GT1 Package that adds LED headlights, better driver assistance features such as forward collision avoidance and park assist, adaptive cruise control, semi-self driving on the highway, 12-speaker Bose audio, ventilated front seats with memory, and more. Upgrading to GT1 spec will cost $4,000, taking the price to $35,455. The Toyota Camry TRD V6 doesn't offer some of the GT1's finer tech. The Toyota Camry XLE V6 needs to be optioned up to match a K5 GT1, the Toyota coming out to $38,325. Cars Direct also saw a bulletin to Kia dealers outlining some lease and purchase offers that will run through August 3.

Hyundai, union reach tentative labor deal

According to Reuters, South Korea's labor unions may have reached a tentative deal with Hyundai following a compromise between the two sides on wages. Workers have staged a number of stoppages since August 20, which have cost the South Korean giant 1.02 trillion won - around $1.1B US. It also represents just over 50,000 units of production. That vehicle total sounds like a lot, but it's a small enough figure that Hyundai can apparently catch up with weekend and overtime shifts. We'd wager that this is why US inventories haven't been hit quite so hard aside from the battering already taking place. The proposal will now go before the union's rank and file.
If ratified, the new agreement will see workers getting a 5.14-percent raise in base salaries, along with 8.5-million-won (roughly $7,800) bonuses. Those concessions are a far cry compared to what the union was initially demanding, though. Early proposals included a 56.25-gram gold medal for each employee (worth about $2,400) and a 10-million won bonus (about $9,100) for employees whose children chose not to attend college. The union also sought a bonus worth two months' salary for workers that have been with the company for over 40 years, but this was negotiated down to a flat rate of six-million won ($5,464).
Based on Reuters' report, the work stoppages must have taken a real toll on Hyundai - its domestic sales dropped 20 percent last month, while exports were down nine percent. Those startling figures must have put some fire under the Hyundai bargaining team.