The increasing cases of vehicle thefts, especially Hyundai and Kia cars, in recent months have become a major headache for the South Korean major, as it points directly to the vulnerability of the models of these two OEMs. Now, both automakers in the same auto group are facing another serious problem, as dozens of insurance companies have filed suit against them, demanding reimbursement for repairing or replacing Hyundai and Kia cars.
The firestorm of Hyundai and Kia car thefts began as a social media hoax in 2022. Some Hyundai and Kia models sold in the US through 2021 have not been equipped with an engine immobilizer. This allowed criminals to use a simple USB cable to boot up specific models and walk away. The thefts damaged the reputations of Hyundai and Kia and also affected their sales. Insurance companies also began to avoid providing insurance coverage for these specific models, leaving consumers with an even bigger problem. Automotive News reports that 69 insurance companies in the United States have so far paid $190 million for stolen Kia and Hyundai vehicles and estimate a total payout of more than $300 million. With this situation in hand, these 69 insurance companies have filed a lawsuit against Hyundai and Kia, demanding compensation for the money they have paid out to the owners of the affected vehicles.
Also read: The top seven tips to prevent thieves from stealing your car
The report also claims that car theft fueled by social media could end up costing the US insurance industry as much as $600 million because 8.3 million vehicles made by the two manufacturers do not have engine immobilizers. This large number includes 3.8 million Hyundai vehicles and 4.5 million Kia vehicles.
Hyundai, in response to this lawsuit, has said that such litigation is unnecessary. “A subset of Hyundai vehicles on the road in the US today — primarily entry-level or ‘br trim’ models — are not equipped with push-button ignition and immobilizers. It is important to clarify that an engine immobilizer is an anti-theft device , and these vehicles are fully compliant with federal anti-theft requirements,” the car company said.
Date of first publication: May 15, 2023, 09:31 IST
