Korea's Transport Ministry on May 10 said it will decide this week on the enforced recall of 250,000 vehicles by Hyundai Motor and Kia Motors over several defects.
Hyundai employee Kim Gwang-ho raised concerns about defects affecting a dozen auto models manufactured by the company and its affiliate Kia. Hyundai and Kia have been arguing the five flaws pose no safety risk, but they said in a joint statement that they will cede to the compulsory recall order. A former employee of Hyundai Motor had tipped off the ministry and local reporters about 32 defects in vehicles made by both companies.
Responding to media reports alleging that corrupt practises in allocation of land had led KIA Motors to shift to Andhra Pradesh, its said "the whole story is totally baseless and done with an intention only to malign the Government". The recall is expected to apply to 240,000 vehicles from 12 models.
Hyundai and Kia together form the world's fifth-largest vehicle maker by sales.More news: Cassia voters vote out incumbent school board members
The two companies have already been ordered to fix 1.5 million cars in South Korea and America over possible engine stalling. The models include some of the carmakers' most popular ones - the Sonata, the Genesis and the Santa Fe.
"Safety is always Hyundai's No.1 priority, and we make decisions on recalls or any other customer-protection steps in compliance with regulators around the world, and follow stringent internal procedures".
"Moreover, Hyundai Motors (major shareholder in Kia Motors) has announced additional investment in its existing unit at SIPCOT Irungattukottai Industrial Park to the tune of Rs 5,000 crore", the statement said. After investigating 32 vehicle defects leaked past year by a whistleblower at Hyundai Motor, the Ministry recommended last month that Hyundai and Kia initiate a voluntary recall for some of the defects. Meanwhile, the ministry also requested Seoul Central District Prosecutors' Office to investigate the possibility that the two automakers' attempted to cover up the defects.