Hyundai eyes subscription program to draw buyers to Ioniq EV

Hyundai is so confident that its new Ioniq 5 crossover will convert on-the-fence buyers to the EV lifestyle that the automaker plans to offer shoppers a few months behind the wheel before making a final decision.

Although Hyundai is still working out the details of its try-and-buy program, preliminary plans are to offer a subscription for one to three months with payments covering the electric vehicle, insurance and maintenance. Hyundai will target potential EV pioneers who first want to see if they can make the transition from a gasoline-powered vehicle.

"When you try before you buy and you find it can work for you in your everyday life, you tend to now want to move toward potentially owning," said Olabisi Boyle, vice president of product planning and mobility strategy at Hyundai Motor North America. "We do expect that they'll transition from try to buy."

Hyundai's subscription program is just one element of the brand's full-court press with its first EV on a dedicated platform. Unlike most Asian rivals that have been ho-hum on electric vehicles, Hyundai says it's all in and ready to compete with a wave of mainstream EV crossovers from legacy automakers such as Ford, Volkswagen and Nissan.

The Ioniq 5 rolls in to showrooms this fall in a limited number of states before a nationwide launch next year.

The roadblock to EV adoption, Boyle said during a presentation last week, is the fear of compromise. Hyundai's goal was to minimize those trade-offs while adding unique EV features such as flat floors and reverse charging to power a campsite from the vehicle's 77.4- kilowatt-hour battery.

With the Ioniq 5, the Korean automaker is promising 300 miles of range for its base model, the fastest charging in the industry, a standard plug that will allow buyers to use the vehicle's battery as a power source and two years of complimentary fast charging on the Electrify America network.

Some of its rivals, such as the Ford Mustang Mach-E and Volkswagen ID4, offer some of those features, such as similar range or free charging. But they don't have the Ioniq's 800-volt architecture for ultra-fast charging or the "vehicle-to-load" feature that allows the battery to serve as a small backup generator.

"When I was attending the global reveal of the Ioniq 5, I was completely blown away. It's a once-in-a-lifetime opportunity," Jose Muñoz, CEO of Hyundai Motor North America, told Automotive News in mid-May.

Although Hyundai sells EV versions of its Ioniq hatchback and Kona crossover based on legacy vehicles, the dedicated E-GMP electric platform from Hyundai Motor Group marks a watershed, Muñoz said.

Hyundai is launching an EV subbrand also called Ioniq and has three models on the way that use the E-GMP architecture: the Ioniq 5 this year, the Ioniq 6 sedan in 2022 and the Ioniq 7 three-row crossover in 2024. Those first three vehicles represent dedicated EV alternatives to the brand's Tucson compact crossover, Sonata midsize sedan and Palisade midsize crossover. In the near future, Hyundai will have a broad EV lineup.

"Ioniq 5 is the first Ioniq vehicle as a subbrand of Hyundai," Muñoz said. "But not only do we have Ioniqs — the 5 and the 6 and the 7 — but we are also introducing 12 battery-EV models [globally]."

The company plans to cut its lineup of gasoline-powered vehicles in half, Reuters reported last week, citing two people familiar with the matter.

Muñoz said that Hyundai plans to make EVs in the U.S. next year and has space at its Montgomery, Ala., factory to expand. But he didn't add much detail to Hyundai Motor Group's recently announced U.S. investment plans. The group, which includes Hyundai, Kia and Genesis, is developing 25 EVs by 2025.

"We have announced that we will start producing EVs in the U.S. in 2022," Muñoz said. "We will utilize existing plants to move fast. And then we will see, because the $7.4 billion [investment] is through 2025."

For now, Hyundai is hyper-focused on launching the Ioniq 5 and its new subbrand with dealers. The subbrand is cost-free to Hyundai retailers who agree to conditions such as technical training and minor facility requirements.

To get a quick start on sales, Boyle said Hyundai plans to price the Ioniq 5 to be competitive with similar crossover EVs. Hyundai will announce pricing closer to launch.

The Mach-E and ID4 start in the low- to mid-$40,000 range with shipping and are eligible for the $7,500 federal tax credit, as is the Ioniq 5. Tesla's Model Y, which Hyundai sees as a reference rather than a rival, is more expensive and no longer qualifies for the federal credit.

Hyundai said the Ioniq 5 will come in three trims.

The SE model has a single rear-drive motor standard, along with the 77.4-kWh battery for an estimated 300 miles of range. It also comes with a standard safety suite and side-by-side 12-inch screens for instrument readings and infotainment.

The SEL model will add leatherette seating and a highway assist feature that will center the vehicle in the lane on cruise control and change lanes when the driver initiates the move with the turn signal, Hyundai said.

The Limited trim bumps the wheel size to 20 inches from 19 inches and adds a fixed panoramic glass roof and a head-up display with augmented reality.

All models are available with an optional front motor for all-wheel drive. Rear-wheel-drive models will have 225 hp and awd models will have 320 hp. Range for the awd models is estimated at 269 miles for the SE and SEL trims and 244 miles for the Limited trim.

Hyundai estimates 0 to 60 mph for the single motor at 7.4 seconds. The two-motor versions will cut that to 5.2 seconds. All models come with the 800-volt architecture compared with the 400-volt systems of rivals.

Hyundai estimates that a five-minute charge at the fastest public chargers can provide 68 miles of range. An 18-minute charge can fill the battery from 10 to 80 percent under ideal conditions.

"If you look at the Mach-E or the Model Y, they're not even close to our capability," said Ryan Miller, manager of electrified powertrain development at the Hyundai Kia America Technical Center. "We really will be the leader in the market for charging time."

The Ioniq 5 can also charge at home in about seven hours using the on-board 10.9-kilowatt charger and a 240-volt electrical supply. That is similar to most rivals.

The Ioniq 5 initially will be sold in 17 states: the 10 states that require zero-emissions vehicles, along with Texas, Florida, Illinois, Georgia, North Carolina, Pennsylvania and Arizona. The crossover will then be rolled out to additional states in 2022 as supply improves, Hyundai said.