Sales of hybrid cars, which combine the advantages of internal combustion engines and electric vehicles in the global automobile market, are rapidly increasing. Accordingly, Toyota, the world's largest automobile manufacturer that has focused on hybrid car development instead of purely electric vehicles over the past few years, recently showed a significant improvement in performance. Hyundai Motor is also contemplating strategic changes, including increasing the production of hybrid cars in the United States.
According to the U.S. Energy Information Administration (EIA), as of the 27th, the share of three types of eco-friendly vehicles — pure electric vehicles, hybrid cars, and plug-in hybrid electric vehicles — in the U.S. light duty vehicle (LDV) market reached 21.2%, up 2.1 percentage points from the previous quarter. LDV consists of passenger cars and trucks weighing 5 tons or less.
The share of hybrid cars reached a record high of 10.6%. Until 2020, the share of hybrids in the total LDV market was around 2%, but it has been rising rapidly in recent years. While the share of pure electric vehicles increased from 7.4% in the second quarter to 8.9% in the third quarter, it still fell short of hybrid sales performance. Hybrid cars are more expensive than conventional internal combustion engine vehicles, but they offer better fuel efficiency and quiet operation, making them an alternative for consumers torn between internal combustion engines and electric vehicles.
Among major automobile manufacturers, Toyota is the one benefiting the most from the growth of hybrid cars. According to Samsung Securities, the total sales of hybrid cars in the United States from January to October this year saw a 34% surge compared to the same period last year, reaching 1.271 million units, with Toyota holding a market share of 58%. In particular, the midsize sedan Camry, released this year, is driving Toyota's hybrid car sales. Starting this year, Toyota has transitioned the Camry sold in the United States to a hybrid-only model.
Since the 2010s, various automobile manufacturers around the world have entered electric vehicle development, but Toyota has stubbornly focused on internal combustion engines and hybrid cars. Akio Toyoda, who has led Toyota since 2009, is regarded as a typical "electric vehicle pessimist." He has repeatedly projected that the growth of electric vehicles will hit a limit. Earlier this year, he also stated, "I expect the market share of electric vehicles to be a maximum of 30%. Internal combustion engines will definitely survive."
Hybrid cars must incorporate both internal combustion engines and electric motors, requiring a high level of technical expertise and a complicated production process. Toyota has invested research and development resources in hybrid cars instead of electric vehicles for a long time and is now acclaimed for its world-class hybrid car technology.
Hyundai Motor and Kia have also recently seen a noticeable increase in hybrid car sales. In October, the combined sales of hybrid cars by Hyundai Motor and Kia in the United States reached 21,679 units, recording the highest ever.
The popularity of hybrid cars is also increasing in South Korea. Hyundai Motor is currently accepting pre-orders for the all-new Palisade, a complete redesign of its large sports utility vehicle (SUV), and approximately 70% of the applicants on the first day chose the hybrid model. The price of the hybrid model of the all-new Palisade is more than 6 million won higher than that of the gasoline model.
As the popularity of hybrid cars continues in the global market, Hyundai Motor Group is currently reviewing ways to modify its production and sales strategies. The upcoming second term of the Donald Trump administration in the U.S. is expected to reduce benefits for electric vehicles, making it inevitable to decrease the share of purely electric vehicles.
Hyundai Motor Group is investing $7.6 billion (approximately 11.15 trillion won) to establish an eco-friendly vehicle production plant called "Metaplant" in Georgia, USA, which is capable of producing 300,000 units annually and has been in operation since October. Initially, the Metaplant was planned to focus on electric vehicle production, but it has been reported that the production share of hybrid cars will be increased following last month's victory of former President Trump in the U.S. presidential election.