Hyundai Motor is in dilemma over what to do with the increasingly unpopular Casper compact SUV, which is manufactured via a joint venture in the southeastern city of Gwangju, according to industry officials, Thursday Gwangju Global Motors (GGM) was set up in 2019 and has manufactured the Casper since September 2021 on a contract deal with Hyundai Motor. The carmaker and the Gwangju regional government jointly invested in the facility for balanced regional growth and local job creation. Hyundai Motor is the second-largest shareholder with a stake of 19 percent there after investing 43.7 billion won ($32.93 million). However, the joint venture is at risk concerning its profitability as sales of the smallest vehicle sold by Hyundai Motor, show little sign of bouncing back amid falling domestic demand for compact cars.
According to industry data, the combined domestic sales for compact vehicles — including the Casper, Kia’s Morning and Ray — have been on a gradual decline over the past year. Their domestic sales came in at 8,350 in January, down 113 from the previous year .Hyundai and Kia are the only carmakers here that manufacture vehicles in the segment, after General Motors (GM) Korea decided to suspend production of its Chevrolet Spark compact car in 2022.Data from the Korea Automobile & Mobility Association showed Casper’s sales here reached 45,400 in 2023, down by more than 5 percent from the previous year. The GGM’s annual Casper production capacity is 45,000. However, given that more customers choose to purchase small SUVs rather than compact cars, the figure is widely expected to drop this year.
With the Casper’s inventory piling up last year, Hyundai Motor held a big sales event by offering discounts of up to 17 percent on the vehicle in November .Hyundai Motor and GGM aim to seek a breakthrough by launching an electrified version of the Casper. They are targeting Europe where demand for compact electric vehicles (EVs) is solid. However, industry officials remain skeptical over whether the strategy will generate tangible outcomes from a short-term viewpoint, as the global EV industry faces growing uncertainties amid falling demand for compact vehicles and EVs as the rise of hybrid vehicles continues .“Carmakers here and abroad do not identify compact vehicles as their profit booster anymore, as its demand is not what it used to be in the past,” an official from a carmaking firm said. “But Hyundai Motor’s strategy targeting Europe remains to be seen from a longer-term perspective until the global EV industry gets more activated 스포츠토토존 within the next few years.”