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Tag: Korea

  • Boom abroad for Hyundai Mobis high-tech car parts

    Boom abroad for Hyundai Mobis high-tech car parts

    Hyundai Mobis said Tuesday it logged $1.7 billion worth of orders for high-tech automotive parts from non-Korean customers last year, setting a new record for overseas sales. High-tech parts include sensors, display and lamps used for self-driving and electric cars. Last year’s figure is a 40 percent jump from $1.2 billion worth of orders in 2017. The parts company has been rapidly expanding its global presence over the years. Orders for high-tech parts from overseas customers totaled just $500 million in 2015.

    The Hyundai affiliate said the record-breaking result is largely due to increasing demand from overseas electric vehicle companies and its focus on developing future car technologies.

    According to Mobis, it received nearly $1 billion worth orders, 60 percent of its total overseas orders, from electric vehicle companies in North America, Europe and China.

    Many electric car companies are start-ups. A Mobis spokesperson said companies at this stage of development tend to be more aggressive when it comes to investment in technology.

    Recently, Mobis signed a deal to supply steering wheel-mounted displays and smart lamps to electric car companies. The products have yet to be commercialized.

    Steering wheel-mounted displays are fit in the center of the wheel.

    Smart lamps will be used for communicating with pedestrians or other cars through the display of light pattern messages.

    The parts maker also signed a contract to supply lateral radars to a North American company. This type of radar extends the sensing coverage of autonomous vehicles.

    The company said it will continue to expand sales of high value-added electronic parts this year as global automakers increasingly rely on digital features to differentiate their products.

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  • Hyundai Motor offering a bigger, better Universe

    Hyundai Motor offering a bigger, better Universe

    Hyundai’s Universe is about to get bigger. Hyundai Motor unveiled an updated version of its luxury coach, the Universe, on Tuesday, increasing its size and adding safety features. The updated coach, scheduled for release next March, has an extended wheelbase of 12.5 meters (41 feet), 0.5 meters longer than the existing model. Distance between seats has been increased.

    The vehicle comes with a variety of new safety features applied for the first time in a coach in the local market, such as an engine fire extinguishing system, driver attention warning and a rear-view monitor.

    Hyundai Motor explained that the Universe’s driver attention warning system and smart cruise control are now offered to prevent drowsy driving and other avoidable accidents. The new Universe also has a refreshed exterior design with headlight changes and will be available in three trims.

  • Apple took unfair profits: Korea FTC

    Apple took unfair profits: Korea FTC

    Korea’s corporate watchdog claimed Apple Korea has bargaining power over local mobile carriers and that it has reaped unfair profits from them in a statement Monday. According to the Fair Trade Commission (FTC), experts called in by the antitrust body said Apple Korea exploited its market position to place part of its advertising costs on local telecommunications companies.

    The statement comes after exchanges between the FTC and the iPhone maker during a deliberation on the company’s position on Jan. 16. It was the second round of hearings since the first deliberation in December.

    Apple Korea has been under investigation by the FTC since 2016 on whether it forced carriers to pay advertising and warranty costs.

    Korea’s fair trade law prohibits abuse of one’s position during a transaction.

    Apple Korea claimed through its expert witnesses, which included economists and business experts, that it does not have leverage over local carriers and defended its actions, saying that its advertisement fund was able to help all parties involved.

    The experts also argued that Apple’s involvement in advertisements was justifiable to maintain the iPhone brand.

    Expert witnesses for the FTC responded that Apple Korea can be regarded as being in a position of power over carriers and that the advertisement fund served to collect additional profit from them. They also stated that the company’s activities in taking part of carrier advertisements cannot be seen as part of their branding strategy.

    The FTC’s Economic Analysis Division provided similar analysis to those made by its witnesses.

    The hearings on the investigation will continue, with the third round of deliberations scheduled for Feb. 20.

    The antitrust body said that the third hearing will discuss specific actions made by Apple. It is unclear whether the third hearing will be the last.

    If found to have abused its position, Apple Korea could face fines worth up to two percent of its related sales.

    The iPhone maker has a history of trouble with the FTC.

    The company made corrective measures under the corporate watchdog for its product replacement policy back in 2011 and its services agreements with local companies in 2016.

  • Samsung factories ready to make 5G and foldable phones

    Samsung factories ready to make 5G and foldable phones

    Samsung Electronics is ready to roll out both 5G and foldable phones, two of most highly-anticipated products from the electronics company. While Samsung has already announced a plan to introduce new Galaxy phones at an unpacking event next month in San Francisco, it is confirmed on Tuesday that Samsung’s global production base in Vietnam has completed preparation to mass-produce 5G phones.

    The 5G phone is tentatively called “Galaxy S10 X.” Two Samsung factories, located in the provinces of Bac Ninh and Thai Nguyen, both north of Hanoi, produce 150 million smartphones a year. The 5G-enabled version of Galaxy S10 produced in Vietnam will be exported globally, starting with the United States. The first one million units of Samsung’s first foldable phone will be produced at the company’s production plant in Gumi, North Gyeongsang.

    The 5G phone “will roll out three to four weeks after the basic Galaxy S10 model hits the market. However, we have finished all preparations to mass produce a 5G phone,” a source from Samsung Electronics said.

    The phone will likely be introduced during the unpacking event on Feb. 20 along with three other versions of Samsung’s 10th-generation Galaxy family: S10, S10+ and S10 light.

    Phones that can connect to the 5G network are expected to bring revolutionary changes in media consumption habits. A 5G phone can download a 1.5 gigabyte movie in under a second.

    Samsung’s first 5G phone is likely to come with a 6.7-inch screen, larger than the 6.1-inch screen of S10 or 6.4-inch screen of S10+.

    The 5G-connected S10 will be powered by the Exynos 9820 chipset.

    Though it is designed for 5G connections, the phone will still be able to connect to 4G LTE as 5G infrastructure development is still underway. Even in Korea, where 5G infrastructure is quickly being built, next-generation connectivity is a work in progress.

    Samsung will first supply 5G phones to five telecom companies, including Verizon, AT&T and Sprint, all in the United States, and SK Telecom and KT in Korea

    Although the 5G phone will be introduced at the unpacking event, the actual launch of the model will come a bit later than the new S10s.

    While basic versions will be released in early March, the actual 5G-capable models will be available at the end of March.

    Samsung has greatly tightened security at its S10 production sites in Vietnam factories after a picture of the Galaxy S10 was leaked online.

    As for the company’s foldable phone, tentatively dubbed the “Galaxy F,” initial production will take place at the Gumi plant. Industry sources project that Samsung is likely to introduce the foldable phone at the unpacking event as well, but will release the phone April at the earliest.

    Federico Casalegno, head of the Samsung Design Innovation Center in North America, said “the foldable phone is a breakthrough in technology innovation,” during a press briefing last week.

    Industry insiders say the main reason for making foldable phones at the local Gumi plant is to prevent technology leaks and better control the initial production volume of the phone.

    “We are not yet ready to mass-produce foldable phones as well in Vietnam,” a spokesperson from Samsung said. “The first one million units of foldable phones and 5G phones to be sold in the Korean market will be produced at the Gumi plant, which is in charge of producing our premium products.”

  • KT, Hyundai Mobis join to develop connected-car tech

    KT, Hyundai Mobis join to develop connected-car tech

    KT said Thursday that it will collaborate with Hyundai Mobis to develop self-driving and connected-car technology.  The two companies agreed to work on real-time navigation technology and vehicle-to-everything technology, which will allow cars to communicate with connected devices. To enable development, the telecommunications company said it will install 5G infrastructure at the Hyundai Mobis test-drive course in Seosan, South Chungcheong.

    The fast 5G network will allow sensors on a Hyundai Mobis self-driving car to send significant amounts of data to servers immediately to allow for accurate real-time traffic navigation. The process takes minutes in existing 4G networks.

    The cooperation comes as the two prepare for the fast-growing connected car market. Industry researcher IHS Markit predicted connected-car sales to reach 72.5 million units by 2023 from 24 million units in 2015.

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  • Trends that coming in 2019 e-commerce

    Trends that coming in 2019 e-commerce

    Led by transformation in sales channels and customer demand, consumer trends for 2019 will center on subscription e-commerce, faster delivery, and eco-packaging, according to market experts. Subscription e-commerce, a field of business that involves curating products and delivering them on a regular basis, has been gaining popularity because it meets needs for tailored services, value, and convenience. From clean, neatly ironed business shirts to craft beers, you can get almost anything through a subscription service — now, even a car.

    Earlier this month, Hyundai Motor’s Genesis introduced a car subscription program that offers subscribers a choice of four Genesis vehicles for 1.49 million won (US$1,330) per month.

    “Our target group is drivers who want to experience a different variety of vehicle without having to worry about car management. The ultimate goal of our subscription program is to satisfy consumer needs amid shifting mobility trends,” Hyundai Motor said.

    According to industry data, subscriber-based businesses are undergoing an explosive expansion, having grown from 241 trillion won in 2000 to 470 trillion won in 2015, globally. Industry experts expect that number to surpass 594 trillion won by 2020.

    McKinsey & Company said in its “State of Fashion 2019” report that the subscription trend goes hand in hand with users’ desire for experiences, as they are more willing to spend money for a service that delivers tangible benefits along with personalized offerings.

    Meanwhile, over the past year, delivery has gotten faster for merchandise purchased via websites and apps. With services like Coupang’s Rocket Delivery, expecting one’s purchase to arrive the next day has become the new norm.

    Cutting down even further on delivery times will be a major sticking point for e-commerce businesses looking to stay afloat, market insiders said, with businesses now competing to ensure overnight deliveries, particularly of fresh food items.

    Overnight delivery is usually available only in Seoul and some parts of Gyeonggi Province and Incheon for now. Experts estimate that the market value of the industry will have reached 400 billion won this year.

    Lotte Mart currently plans to test-operate a 30-minute delivery service in the first quarter of the new year. Since September, it has offered a delivery service that moves products from its stores within three hours after purchase at an offline store.

    E-commerce company Coupang also plans to make a concerted effort to expand the overnight and even same-day delivery of fresh food products in 2019.

    “Our latest paid membership service, Rocket Wow club, which guarantees next-morning delivery for signed-up members, had already garnered almost 1 million members just two months after the service’s launch. We plan to expand the service to cover all customers across the country in the new year,” a Coupang representative said.

    The environmental packaging boom is set to continue well into 2019 as well. While plastic is not inherently bad, the way it is thrown away is problematic. As a result, an increasing number of consumers are rethinking their plastic use in an effort to cut waste.

    With environmental packaging campaigns spreading worldwide, manufacturers have been challenged to innovate their packaging methods.

    Since September, Starbucks Korea has replaced plastic straws with paper straws at some 100 of its stores in Seoul, Busan and Jeju, in an effort to reduce waste and protect the environment. All its paper straws are coated with soybean oil to make them more durable, the company said.

    The coffee franchise plans to eliminate single-use plastic straws from its 28,000 stores worldwide by 2020. Angel-in-us Coffee, the cafe chain operated by South Korean retail giant Lotte, also introduced special lids for cold drinks in an effort to reduce plastic use.

    “The throwaway culture is rapidly being challenged by increasing consumer awareness of the perils of plastic waste. A dramatic change in attitudes has occurred, forcing brands to rethink how they make better use of plastic in what they offer to consumers, who increasingly demand brands reduce, reuse and recycle plastic waste to better protect them and their world,” said Matthew Crabbe, a director of Trends APAC, in Global Consumer Trend report by Mintel.

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  • Johnson & Johnson, Apple collaborate for healthcare

    Johnson & Johnson, Apple collaborate for healthcare

    Apple and Johnson & Johnson are teaming up on a study to determine whether the latest Apple Watch, in conjunction with an app from the pharmaceutical company, can accelerate the diagnosis of a leading cause of stroke. Atrial fibrillation, or AFib, is an irregular and often rapid heart rate that causes about 130,000 deaths and 750,000 hospitalizations each year in the U.S., Johnson & Johnson said. Up to 30 percent of cases go undiagnosed until life-threatening complications occur. Worldwide, about 33 million people have the condition.

    The controlled, randomized multi-year Johnson & Johnson study will start later this year and be limited to U.S. adults ages 65 years and older who wear the Apple Watch Series 4. Specific details on how to participate will be released later.

    The Apple Watch Series 4, which costs $399 or more, has an irregular heart rhythm notification feature, as well as an FDA-cleared ECG app, both of which are designed to detect AFib.

    “We are receiving thank you letters daily from Apple Watch wearers who are discovering they have AFib,” said Apple Chief Operating Officer Jeff Williams. “We want a deeper understanding about outcomes and prevention associated with early detection. We are excited to work with Johnson & Johnson, which has a long history and expertise in cardiovascular disease.”

    Paul Stoffels, Johnson & Johnson’s executive vice president and chief scientific officer, said “the goal is to identify early on AFib and prevent stroke by combining the physical know-how from Apple and what we have from the medical and scientific know-how.”

    Cardiologist Paul Burton, Johnson & Johnson’s vice president of medical affairs for internal medicine, added the watch has a good detection rate for the condition, but there can be false positives.

    If an AFib reading appears, patients are directed to seek a formal diagnosis from their medical provider. Johnson & Johnson’s goal is to collect aggregate data from study participants, rather than tracking individual patients.

    “When we do clinical trials, we always respect the privacy of patients,” Stoffels says.

    Burton believes “the study has the potential to show that there is a lot more atrial fibrillation out there in the real world in older people than we ever imagined, and if you use a tool like an Apple Watch to detect and funnel people to care, you can really drive down stroke risk in those patients.”

    Apple CEO Tim Cook recently talked about Apple’s ambitions in the health space. “I think you’ll be able to look back at some point in the future and Apple’s greatest contribution will have been to people’s health. I think it’s that big.”

    In November 2017, Apple teamed up with the Stanford University School of Medicine on an Apple Heart Study app that uses the heart rate sensor inside the Apple Watch to collect data on irregular heart rhythms. That study is ongoing.

    Apple also hopes iPhone owners will store medical records inside the Health app.

    Stoffels says wearable technology will continue to take on increased importance in the health field, from monitoring whether patients take medications to measuring sleep. “Digital and data will become part of everything we do.”

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  • Tinder sees Korea as stepping stone to region

    Tinder sees Korea as stepping stone to region

    Korea is the test bed for Tinder services in the rest of Asia, the dating app’s CEO said during his first press conference in the country on Tuesday.  “South Korea is an important market for us because of the market itself, but also because of the cultural influence it has over the broader Asia region,” said Tinder CEO Elie Seidman. Seidman previously served as the CEO of OkCupid, another popular American dating service.

    “Not only do most Koreans have smartphones and use social media, but the country wields a lot of influence in Asia through K-pop and the Korean wave.”

    Korea’s potential to raise the brand awareness of Tinder across Asia has already been demonstrated, according to the app’s regional director.

    “We once worked together with Korean celebrities Kim Jong-kook and Haha to have them use Tinder during a trip in Vietnam” for a reality TV show, said Lyla Seo, regional director, East Asia. “We saw a huge surge in Tinder users in Vietnam following the program.”

    Seo, who is Korean, oversees the dating service’s business in Korea, Japan and Indonesia. Seo worked as a marketing manager for Google Korea before joining Tinder.

    “Tinder has the so-called passport service, which allows people to view and match with users from other countries. The top five countries that used the passport to meet Koreans were Singapore, Japan, Thailand, Indonesia and Malaysia, reflecting the popularity of Korean culture,” she added.

    In Korea, the dating app first launched in 2015 and has been growing rapidly since. Tinder in Korea reported over 2.5 times more downloads last year compared to 2016. The service is especially popular among women, and over 80 percent of the users here are millennials.

    According to Tinder, the three biggest reasons Koreans use the app are to meet new types of people from different backgrounds, find users with similar hobbies and meet users in the same area.

    Users in Korea are most active on the app around 10 p.m. on Monday after they come back from work or school, Tinder also said.

    Tinder’s plan in Korea this year is to draw in more college-aged students and promote the idea that the app can be used to meet friends under the “Find a friend on Tinder” campaign.

    “In Korea, we are planning to introduce more marketing activities targeting college students and contribute to society by launching a scholarship program,” Seo said.

    Tinder, founded in 2012, has around 4.1 million paying users and generated $800 million in revenue last year worldwide.

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  • The Lipstick Effect drives South Korea cosmetics sales

    The Lipstick Effect drives South Korea cosmetics sales

    The Lipstick Effect has seen a rise in cosmetics sales despite South Korea’s economic downturn of 2018. The term The Lipstick Effect describes the phenomenon whereby colour cosmetics sales surge during a recession as consumers turn to small-ticket luxuries to lighten their mood.

    Major South Korean health and beauty retailer Olive Young saw a 35 per cent jump in colour cosmetics sales last year – the first time this product range has topped its best-selling category list – as the country struggled with sluggish job markets, conservative corporate investment and overall low consumer spending. Health functional food and hair products grew 32 per cent and 22 per cent respectively over the period.

    The outlook for cosmetics sales looks similarly bright this year as the rest of the South Korean economy is expected to wallow at 2018 levels.

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  • Samsung spent $3.12M lobbying in U.S. last year

    Samsung spent $3.12M lobbying in U.S. last year

    The American subsidiary of Korean tech giant Samsung Electronics spent $3.12 million on lobbying U.S. politicians and officials last year, the second-largest amount following 2017, data from a Washington-based research group showed Monday. Samsung Electronics’ lobbying expense was the ninth largest among electronics companies operating in the United States, moving up two notches from a year earlier, according to the Center for Responsive Politics (CRP).

    Microsoft spent the most with $7.18 million, followed by Qualcomm with $6 million, Oracle with $5.47 million and Apple with $5.09 million, said the nonprofit research group, which tracks the effects of money and lobbying on elections and public policy.

    Among foreign companies, Samsung Electronics was the second-biggest lobbying spender after German engineering group Siemens.

    The Korean tech conglomerate has been intensifying its lobbying efforts in its key market since U.S. President Donald Trump took office in 2017 and advocated more protectionist trade policies.

    Samsung’s lobbying expenses over the past two years amounted to $6.62 million, far surpassing $6.04 million spent during former President Barack Obama’s second term from 2013-16, data showed.

    Trade-related issues were Samsung’s main lobbying target in the United States last year, with 13 cases out of 81 total in this area.

    The company also made extensive lobbying efforts for the telecommunication sector as it has been exploring ways to expand its foothold in the 5G network equipment market.

    Last month, Samsung and American telecommunication company Verizon announced their plan to launch 5G-compatible smartphones in the U.S. market in the first half of 2019.

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  • Mercedes EV to launch in Korea

    Mercedes EV to launch in Korea

    Mercedes-Benz Korea is setting its sights on the local eco-friendly auto market with the introduction of an all-electric vehicle (EV) along with hybrid offerings this year. The Korean unit of the German brand announced Thursday that it will be introducing 14 new models to the local market this year including the EQC, the first model under its electric EQ brand, as well as four plug-in hybrid EVs at a New Year’s press conference at the Hotel Shilla in central Seoul.

    “2019 will be the year of the EQ,” said Dimitris Psillakis, CEO of Mercedes-Benz Korea. “We will do our utmost to provide the best products and services in the upcoming era of future mobility.”

    The premium electric SUV EQC, unveiled globally last September, is the German automaker’s current flagship EV. The promised hybrid models will range from SUVs to sedans, according to the automaker.

    Along with its entry into the local EV market, the German brand announced that it is also preparing its charging infrastructure.

    Mercedes-Benz Korea said EQC buyers will have access to its combined charging network, which will offer a wide range of charging stations nationwide. EQC drivers will also have access to a one-on-one concierge service that will recommend the nearest charging station to drivers.

    Mercedes-Benz Korea’s push into eco-friendly vehicles comes as it was embroiled in controversy last year regarding its vehicles’ emissions certifications.

    Last month, the automaker said it will appeal a court decision after it was found guilty of violating environmental and customs laws regarding the emissions certification process. The company was fined 2.81 billion won ($2.5 million) and an employee in charge of certifications was handed an eight-month sentence.

    Regarding the legal action, Psillakis promised that the company is following up on the newest regulations.

    “We have a very different changing and toughening regulatory environment around us,” said Psillakis. “We place processes to safeguard so that we can adapt to the new regulations as fast as possible.”

    The company also addressed concerns surrounding recall plans for its vehicles equipped with faulty Takata airbags, saying that it is planning a mass recall in the second quarter of this year of around 30,000 vehicles.

    The German automaker was the best-selling imported brand last year, selling 70,798 vehicles in the country.

    With last year’s sales, the Korean market is the fifth-largest market for the brand after China, the United States, Germany and Britain.

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  • Hyundai develops safer airbag deployment system

    Hyundai develops safer airbag deployment system

    Hyundai Motor Group, Korea’s biggest carmaker by sales, said Monday it has developed a safer airbag deployment system to better protect people from multiple crashes. The advanced airbag system immediately prepares for additional crashes once it recognizes an initial collision, in cases where the collision is not serious enough to warrant a deployment, the conglomerate said in a statement.

    “If the first collision is a minor one, but the vehicle continues on and collides with something else, such as trees or street lamps, the airbag system optimizes itself to prepare for additional crashes,” a company spokesman explained to reporters over the phone.

    It is the first time a Korean carmaker has developed such a multi-crash airbag system, the statement said.

    Existing airbag systems do not inflate once they determine the initial collision is minor, even if subsequent impacts involve greater force and can lead to serious injury, it said.

  • Air purifier sales up 414 % after dust attack in Korea

    Air purifier sales up 414 % after dust attack in Korea

    As fine dust blows into Korea, demand for products that defend against pollution spike. According to an Emart study released Friday, mask sales between Jan. 10 and Jan. 16 surged 458 percent from the same period a year earlier while the sales of air purifiers are up 414 percent. Usually, the products are in high demand around late February and in March, when the yellow dust from the northern deserts descend on the Korean Peninsula. But sales this year are already 95 percent of the total usually reported in March.

    Sales of consumer appliances that clean clothing, such as LG’s Styler clothes closest, are up 186 percent compared to the same period a year ago, according to the retailer. Sales of dryers have increased 67 percent as the worsening pollution has made it difficult to dry laundry outdoors.

    Emart said it will be holding a special sale on fine-dust countering goods through Jan. 30.

    It plans to offer discounts on the bulk purchase of masks: 10 percent when buying two and 30 percent when buying three at a time.

    The Samsung Electronics air purifier with model number AX6ON5081 WDD will be sold at 379,000 won ($338), a 90,000 won discount, while Coway’s AP-1818C model will be sold at 439,000 won, a 60,000 won discount. The purchase of Coway’s air purifier also comes with 85,000 won worth of additional filters and 50,000 won in gift certificates.

    The retailer is also providing discounts on vacuum cleaners, including Dyson’s V10 Fluffy, the LG Electronics A9, which also has a mopping feature, Samsung’s VS8ON8062KKS and Tepal’s Air Force 360.

    Online shopping malls are ramping up their marketing of fine dust-related products. Coupang has been promoting 650,000 fine-dust products since Jan. 10.

    An exclusive study by the JoongAng Ilbo found that much of the recent air pollution is coming from China.

    The Korean Meteorological Administration is forecasting a return of high fine-dust readings. It said the level of concentration of pollutants started rising on Friday and will continue to increase today.

    When the concentration is at 15 micrograms per square meter or lower, the government rates the air quality as “good.” When it is between 16 and 35, it is deemed “normal.” When the figure is between 36 and 75, the government rates the air quality as “bad.”

    On Jan. 14, the fine-dust concentrations in the greater Seoul area peaked at 122 micrograms per square meter, the highest level since related data was first collected in 2015.

    That was two days after air pollution in major areas in China, including Beijing, Tianjin, Tangshan and Hubei Province, peaked.

    The Korean Meteorological Administration forecasts air pollution levels dropping from Sunday afternoon.

    Kweather, a private weather company, has advised people to stay indoors over the weekend and wear a protective mask when having to go outside.

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  • Love Yourself a BTS-themed coca cola

    Love Yourself a BTS-themed coca cola

    Coca-Cola launched BTS-themed bottles as part of its “Share a Coke” campaign on Monday. The bottles come in seven different designs – each one representing a member of the K-pop boy group – with inspirational messages referencing the group’s song titles. This year, the special Coke bottle labels read in Korean “Your spring day is today,” “I’m fine if it’s you,” “Run like yourself,” “You’re really dope,” “You are my idol,” “Go instead of worry” and “This year is blazing fire.”

    Bottles are also decorated with images of the members’ faces and vivid colors like pink, yellow and green.

    The BTS-themed drinks are available in grocery stores and convenience stores across Korea. They come in 350-milliliter (12-ounce) aluminum cans and 500-milliliter, 1.5-liter and 1.8-liter bottles.

    Coca-Cola in Korea has been launching special edition Coke bottles as part of its Share a Coke storytelling campaign since 2014. The campaign’s goal is to help consumers share hopeful messages with friends and family by exchanging the drinks with one another.

  • Hyundai, Kia move ahead with recall in U.S.

    Hyundai, Kia move ahead with recall in U.S.

    Despite a government shutdown, Hyundai and Kia are moving ahead with a recall of about 168,000 vehicles to fix a fuel pipe problem that can cause engine fires. The problem stems from improper repairs during previous recalls for engine failures. The affiliated Korean automakers have been dogged by fire and engine failure complaints from across the nation. They’re both under investigation by the U.S. National Highway Traffic Safety Administration, which has been trying to figure out whether initial recalls covered enough vehicles. But the agency is mostly closed due to the shutdown.

    In addition to the recall, each automaker says it will do a “product improvement campaign” covering a total of 3.7 million vehicles to install software that will alert drivers of possible engine failures and send the cars into a reduced-speed “limp” mode if problems are detected.

    Nhtsa employees who do safety investigations and recall notifications are not at work. Under normal circumstances, the agency would review the recalls to make sure they are adequate and post details on the agency website. It would also monitor notices to customers, and ensure customers could check to see if their vehicles are included.

    Kia spokesman James Bell said the company is proceeding with the recall and campaign regardless of government delays.

    “Making our customers comfortable is vastly more important than making sure we’re following additional government processes right now,” he said. Kia sent letters to dealers around Jan. 10 notifying them of the recall, he said.

    But a U.S. auto safety advocate called the recalls inadequate and said the product improvement campaigns should instead be recalls that are overseen by Nhtsa.

    An Nhtsa spokeswoman said she could not comment due to the shutdown.

    Hyundai and Kia started recalling 1.7 million vehicles in 2015 – about 618,000 of which are Kias – because manufacturing debris can restrict oil flow to connecting rod bearings. That can cause bearings in 2-liter and 2.4-liter four-cylinder engines to wear and fail. The problem can also cause fires. The repair in many cases is an expensive engine block replacement.

    Now the companies are acknowledging that the engine replacements may not have been properly done in all cases by dealers. A Kia statement says the high-pressure fuel pipe may have been damaged, misaligned or improperly tightened while the engines were being replaced under recall. That can allow fuel to leak and hit hot engine parts, causing fires.

    Kia says it has six reports of fires among the vehicles being recalled for possible fuel leaks, while Hyundai says it has no fire reports. Neither company had any reports of injuries.

    The fuel injector pipe recall covers some 2011 through 2014 Kia Optima cars, 2012 through 2014 Sorento SUVs, and 2011 through 2013 Sportage SUVs, all with 2-liter and 2.4-liter four-cylinder engines. Also covered are many 2011 to 2014 Hyundai Sonata cars and 2013 and 2014 Santa Fe Sport SUVs.

    More than 2 million 2011 Sonatas from the 2011 through 2018 model years and Santa Fe Sports from 2013 through 2018 are covered by the software and engine-knock sensor updates. About 1.7 million Kias, including the 2011 through 2018 Optima, the 2012 through 2018 Sorento and 2011 through 18 Sportage, are covered.

    The companies say owners of the recalled vehicles will be notified by letter. Dealers will check the fuel pipe for leaks and replace the pipe if needed.

    Kia is only doing the fix on 68,000 of its 618,000 vehicles recalled for the engine problems, while Hyundai is recalling 100,000 of more than 1 million. Hyundai said only vehicles that had engines replaced in the previous recalls are covered by the new recall.

    He also raised concerns about the government shutdown’s impact on Nhtsa, which he said should be open to handle critical safety recalls.