It's a tough but necessary move for Hyundai to adapt to the shifting landscape of the EV market.
South Korean automaker Hyundai Motor plans to temporarily suspend production of certain electric vehicle (EV) models at its major plant in Ulsan. The decision comes in response to declining global demand for EVs and mounting trade barriers, including new tariffs imposed by the United States.
According to unnamed industry sources, Hyundai will halt some production lines from April 24 to April 30, affecting the assembly of Ioniq 5 and Kona EV models. These vehicles are central to Hyundai’s EV strategy, but recent trends have cast doubt on previously optimistic forecasts.
The suspension in Ulsan reflects broader market dynamics. This spring, a sharp decline in EV orders from key export markets has been observed. One major factor behind this drop is the phasing out of government subsidies for electric vehicles in several countries.
Reductions in state support programs for EV purchases
Disruptions and uncertainties in global logistics
Growing competition in the affordable EV segment
Consumer concerns over high prices and charging infrastructure limitations
The situation worsened in April when the U.S. administration announced a 25% tariff on imported passenger and light-duty vehicles. The move, introduced earlier this month, is part of a broader protectionist trade agenda championed by American leadership.
These new duties significantly affect foreign manufacturers like Hyundai, which maintains a strong presence in the North American market. Despite announcing major investments — including $21 billion in U.S. facilities in March — the company still relies on exports for certain models.
Hyundai Motor has not issued an official comment regarding the temporary production halt. However, in an effort to mitigate potential disruptions to dealer operations, the company announced that it will maintain current manufacturer’s suggested retail prices (MSRP) for its entire model lineup for the next two months, through June 2.
This measure appears aimed at stabilizing its market position and maintaining confidence among business partners during a period of uncertainty.
Even a one-week production stop signals a potential reassessment of EV strategies. With significant investments already made in the electric segment and new manufacturing facilities abroad, this move may represent a cost-management measure rather than a shift in direction.
Analysts point to a number of factors behind the adjustment:
Changes in global trade and tariff policies
Declining profitability of certain EV models
Increasing uncertainty in major export markets
Competitive pressure from local manufacturers in the U.S. and Europe
Hyundai’s latest move illustrates the EV market’s sensitivity to external economic and political developments. While the global push toward decarbonized transportation remains strong, the path to widespread EV adoption continues to face hurdles — including policy changes and volatile consumer sentiment.
The way automakers respond to these changes will shape the industry's trajectory in the months ahead. For Hyundai, the current decision appears to be a temporary adjustment, not a retreat from long-term EV goals. However, the situation's evolution will largely depend on geopolitical shifts and market trends.
