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Hyundai Motor shares slide following U.S. probe of airbag failures

SEOUL — Shares in Hyundai Motor tumbled on Monday on a U.S. probe into why airbags failed to deploy in some of its Sonata sedans, with investors fretting about potential recall costs for the once popular cars. The probe, which follows crashes that reportedly killed four people and left six injured, will review the 2011 Sonata sedan as well as the 2012-2013 Forte made by affiliate Kia Motors, encompassing some 425,000 vehicles. It marks the second investigation by the U.S. National Highway Traffic Safety Administration into the South Korean duo in less than one year, exacerbating headaches for Hyundai which reported in January its worst annual earnings in seven years. Hyundai has issued a recall for more than 150,000 U.S. Sonatas after incidents of non-deployment were linked to electrical overstress in the airbag control unit, but said it did not have a final fix. "What I am concerned about is that the recall will be expanded to other markets," said Ko Tae-bong, an analyst at Hi Investment & Securities. The Sonata and Forte sedans were responsible for driving sales for Hyundai and Kia in key markets in recent years, although they are no longer as popular as they once were. Ko estimated the U.S. recall could cost as much as $575 million if airbags were replaced in 425,000 vehicles under review and the automakers were found responsible for the problem. Hyundai Motor shares tumbled 4.8 percent while Kia Motors lost 3.7 percent. Parts supplier Hyundai Mobis fell 5.4 percent while the broader market was down 0.7 percent. Hyundai declined to comment on whether the recall would be expanded. Kia said it has not confirmed problems with the airbags but added it would "act promptly to conduct a safety recall, if it determines that a recall would be appropriate." The automakers told the South Korean regulator that the Sonata and Forte models sold in the domestic market were not affected, an official at South Korea's transport ministry told Reuters. The U.S. regulator said the airbag control units were built by ZF Friedrichshafen-TRW, a German auto supplier that acquired TRW Automotive in 2015, adding that it would determine if any other manufacturers used similar airbag control units and if they posed a safety risk. The NHTSA also said that electrical overstress appeared to be the root cause in the 2016 recall by Fiat Chrysler America of 1.4 million U.S. vehicles for airbag non-deployments in significant frontal crashes.

Rimac will help Kia turn the Imagine concept into a high-performance flagship

The segment-bending Imagine concept Kia unveiled at the 2019 Geneva auto show will spawn a high-performance flagship in 2021. Rimac, which Kia and Hyundai jointly invested in, will help bring it to the market. "This car will have a significant effect on how consumers perceive Kia and its part in future electrification. We want it to demonstrate super-high performance levels but in a package that is different," affirmed Carlos Lahoz, the automaker's marketing chief, in an interview with British magazine Autocar. "Super-high performance" isn't a term we've ever used to describe a Kia, even the Stinger doesn't merit this label, so Lahoz's comments sketch an image of a model that breaks all ties with members of the company's current range. Croatia-based Rimac, an expert in making quick electric cars, will play a role in the development process. The extent of Rimac's involvement remains a mystery. Similarly, we don't know how Kia defines the term "super-high performance," and whether it alludes to straight-line speed, Tail of the Dragon-taming handling, or both. Like the Imagine concept (pictured), the production model will arrive as a sedan-crossover cocktail vaguely reminiscent of the short-lived Volvo S60 Cross Country, among other high-riding four-doors. Its front and rear ends will likely be toned down, but Kia stylists have been on a roll in recent years so we expect a head-turning design. As for the 21-screen infotainment system, which Kia labeled a "humorous riposte" to the industry's obsession with in-car displays, we're betting it won't make the leap from the show floor to the showroom floor.  The sheet metal will hide a new platform Kia is developing jointly with Hyundai specifically to underpin electric cars. Autoblog understands it will underpin future Genesis models, too. The architecture will be compatible with an 800-volt electrical system that charges the battery from 20% to 80% in 20 minutes, and Autocar reported the Imagine will offer up to 310 miles of driving range, though odds are that's on the optimistic WLTP testing cycle. Kia's announcement that the Imagine — a name the production version won't wear — will arrive in 2021 suggests it could land on our shores for the 2022 model year. The company hasn't revealed whether it will sell the model in the United States, however. Don't let the idea of a high-horsepower, quasi-luxury electric car from Kia fool you.

Hyundai, Kia launching dedicated hybrids in 2017

The currently weak green car market isn't stopping Hyundai and Kia from staging an ongoing electrified onslaught, and it's primed to just keep growing. Already familiar with the field thanks to vehicles like the Sonata Hybrid, Tucson Fuel Cell, and Kia Soul EV, for the 2017 model year the Korean siblings are launching their first dedicated hybrids, according to Automotive News. Since last year, the hybrids have been spotted testing several times while wearing heavy camouflage. Hyundai's version will reportedly be styled as a Chevrolet Volt-fighting sedan. Conversely, Kia will go for a more directly Prius-challenging hatchback. Underneath, they'll share a powertrain consisting of a direct-injected, 1.6-liter four-cylinder and electric motor. Both will use the same platform based on the next-gen Elantra and Forte, according to Automotive News. In addition, Hyundai will get a pure EV version of its model to launch in California in 2017, while Kia reportedly won't. According to Automotive News, the companies' strategy is reportedly to be ready when gas prices eventually rise again. "When they come back up and people start looking for hybrids again, it'll be very nice to be able to give buyers an option besides just the Prius," said Adam Kraushaar, president of a New Jersey Hyundai dealer. Further complimenting the electrified plans, a plug-in version of the Kia Optima Hybrid is also reportedly on the way. With its launch, the two brands would have a total of nine hybrid, EV or fuel cell vehicles on offer by the 2018 model year.