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On the 24th, Hyundai Motor Company decided to replace the entire battery for about 82,000 units such as Kona Electric Vehicles (EV), Ioniq, and Electric Bus Electic through a voluntary recall. The problem is the recall cost, which is expected to reach 1 trillion won. Hyundai Motor Company plans to calculate the final cost by reflecting the share rate with LG Energy Solutions, a battery supplier, and reflect it in the fourth quarter of last year.
Hana Financial Investment also raised the possibility that Hyundai Motor will reflect the total cost of 1 trillion won first. In this case, Hyundai Motor’s fourth quarter of last year and its annual sales and operating profit are expected to reach 640 billion won and 1.78 trillion won, respectively. It is the amount minus 1 trillion won from the previous estimate of 1.64 trillion won and 2.78 trillion won. Song Seon-jae, a researcher at Hana Financial Investment, said, “If the results of negotiations with LG Energy Solutions do not come out until next week, Hyundai Motor Company can first reflect the total cost of KRW 1 trillion and then choose an accounting method that reverses the cost according to the share rate in the future.”
In addition, brand damage and cost reflection due to fires such as Kona EV are negative for the company, but it is also predicted that the relief of related burdens before the launch of’Ionic 5’at the end of March will be offset. Researcher Song said, “This recall can offset this by removing the uncertainty related to the electric car fire, reducing the marketing burden for the Ioniq brand and promoting active promotions in the future.”