Based on the positioning and the success of the Ioniq products, would you consider making it a stand-alone brand?
No. The fact that Hyundai already holds a leading position in alternative powertrains gave strength and credibility to Ioniq as a product line. Building on this with our Ioniq models, this plays well into the rest of the Hyundai lineup. There can only be one brand, and that brand is Hyundai.
What percentage of Hyundai's total sales were full electric in the first half and what is the target for the full year?
In the first half and for the full year, we want zero-emission vehicles to account for 16 percent of our sales in Europe, which would be mostly BEVs [battery-electric vehicles] and a few Nexo hydrogen fuel cell vehicles. We reached that number in the first half, meaning zero-emission cars accounted for almost one out of every six vehicles sold.
What is your outlook for Hyundai's BEV sales next year?
I think it will be around 20 percent. The Ioniq 6 will give us a boost. But we have to be mindful of how much the current supply constraints on other vehicles are driving EV penetration.
Hyundai has been pondering whether to launch of small BEV. When will a decision be made? What is the target price and how difficult will that price be to reach giving the rapid rise in raw materials prices?
It's something that we are considering because smaller vehicles are an important part of the European market. We haven't made any final decision yet, and it's getting a bit more complicated given the rising cost of raw materials. A 20,000-euro target price is a challenge not just for us. Is it realistic? Given the rising materials prices, I think it's becoming more and more difficult. That is something we are going to resolve in the next 12 months. But we envision a small, entry BEV being an important part of our future proposition.
Is there any chance that we see such a product before 2025 or after?
I think it will be after 2025.
Competitors such as Toyota have abandoned the traditional minicar segment, making their entry model a small SUV/crossover. Will Hyundai do the same because this body style provides the chance to charge a higher price and generate a better margin?
We are open to considering the size of the entry vehicle. Is it in the A-segment (minicar)? Is it in the B-segment (small)? Or is it somewhere in between? These are things we are discussing. I can't confirm anything today because we are just starting the discussions.
With rising inflation, customers have less disposable income at a time when car prices are also increasing. Given these constraints, do you see European, Japanese and Korean automakers leaving the entry-level, 15,000-euro segment to a Chinese brand?
We are certainly not in that position right now. We wouldn't want to give up on any part of the mainstream market in which we believed we had a solid customer base and good opportunities. I believe in our ability to achieve that price target. On the other hand, we are also not the least expensive in the sector. We have built our image in Europe on quality, engineering and design. We have price parity with long-established mainstream brands in Europe, which is a strong position for us.
How could you address the lowest part of the market?
There will be opportunities to introduce entry EVs at a price point, which customers will accept. On one hand, if residual values remain healthy, and there is still a product demand, maybe we could move toward leasing or subscription services, where we provide access to entry EV mobility on affordable monthly payments. On the other hand, I think support from European governments is still important to help drive the EV transition. Hopefully, we will see them continue to demonstrate their commitment to carbon neutrality, a topic that we wholeheartedly support.
It seems likely the EU will ban the sale of combustion cars by 2035. Could you envisage Hyundai stopping all combustion car sales in Europe before that date, which is what some competitors have already announced?
It's possible, but it's not in our plan. The biggest challenge in Europe is the disparity across the region. In some of the Central or Eastern European markets, maybe even some of the southern European markets, the 2035 deadline will be a challenge.
You said two years ago everybody was worried about CO2 targets. Now, actually, nobody seems to speak about CO2 targets anymore. Did Hyundai make last year's targets? When will we know the official EU measurements?
In 2020, we had to measure meticulously right until year-end, while last year, we easily achieved our target. We expect it to be even easier in 2022 because of our product mix. We not only have EVs but also plug-in hybrids, which we didn't have in any volume in 2020. Right now, we are not concerned, but that doesn't mean that we are relaxed about our targets. If you aim to reduce your CO2 targets by 55 percent by 2030 versus 2021, it probably means that your lineup is going to have to comprise 65 to 70 percent zero-emission vehicles. That will be tough given the lack of EV infrastructure in some Central and Eastern European markets. But I'm confident we will get there because of our strength in EVs.