Hyundai's EV recall to cost 50% of carmaker's 2020 net income

The current figure is very close to half of the carmaker's 2020 net revenue. This loss will be reflected in the company's Q4 results.

The latest Hyundai Kona EV recall of nearly 82,000 cars could be one of the most expensive EV recalls so far. It is estimated to cost the carmaker US$ 900 million.

The Kona EV is being recalled due to a potential fire risk in battery cells produced by LG in China. While a final figure of the amount will be based on negotiations between the Korean carmaker and LG Energy, the current figure is very close to half of the carmaker's 2020 net revenue. This loss will be reflected in the company's Q4 results.

So far, there have been 16 cases where the battery cells of the Kona EV have caught fire. Apart from the Kona, Hyundai has had to recall 5,700 Ioniq compact EVs and 305 Elec City buses as well.

This is not the first time an electric vehicle has been recalled due to battery concerns. Over 70,000 Chevy Bolt EVs were recalled for the same issue. Hyundai had earlier announced a recall for the Kona EV in October 2020 to replace the battery and update the software.

Source - Bloomberg