South Korea's transport ministry announced a nationwide recall of 58,000 Hyundai Motor Palisade hybrid sport utility vehicles on Tuesday, citing safety issues tied to the vehicles' automatic seat systems.
The recall in South Korea follows a string of incidents, including a fatality in the United States earlier this month. Hyundai halted sales of some high-end variants of the latest Palisade model and has already recalled 68,500 new Palisade SUVs in the United States and Canada after a two-year-old girl in Ohio died on March 7. Local reports indicated the automatic seat on the third row collapsed onto the child. Hyundai said it is investigating that incident.
Domestic reports from Hyundai indicated two Palisade passengers in South Korea were injured in October and December of last year, in incidents that may be linked to the automatic seats. The company also notified the U.S. safety regulator last week of four injuries in the United States that it tied to the power seat issue.
The transport ministry described the technical problem as stemming from inadequate software design in the seat controllers. Because of that design deficiency, the second- and third-row seats may fail to detect contact with occupants or objects, creating safety risks for those inside the vehicle.
As an interim measure, Hyundai began offering a software update on Friday intended to reduce immediate risk. The update changes the way the automatic-folding function is disabled - simplifying it to a single switch operation. Previously, a user needed to turn the vehicle off and then back on to disable the power seat feature. The update also prevents the power seat function from being activated unless the tailgate is open. The transport ministry said Hyundai is considering additional steps to further enhance safety.
Palisade was Hyundai's top-selling SUV in South Korea last year. Financial analysis from Meritz Securities noted that if the recall ultimately requires hardware replacement rather than just software fixes, the cost to the automaker could be about 100 billion won, roughly $66.08 million using the exchange rate cited of $1 = 1,513.3000 won. The same report also warned the automaker could face potential class-action lawsuits and punitive damage claims.
Hyundai has not announced any final remedial plan beyond the initial software update and said it is continuing an investigation into the incidents linked to the power seat mechanism. Regulators and the company appear to be balancing short-term mitigation through software with consideration of further hardware or procedural actions pending the outcome of ongoing inquiries.
Summary
Authorities in South Korea ordered a recall of 58,000 Hyundai Palisade hybrids due to defective seat-controller software that can prevent detection of occupants, following related injuries domestically and abroad and a recent child fatality in the United States. Hyundai has supplied an interim software update and is assessing further measures; analysts estimate hardware replacement could cost roughly 100 billion won.
Key points
- 58,000 Palisade hybrids recalled in South Korea for seat-controller software defects that may fail to detect occupants or objects.
- Related actions include halted sales of some high-end Palisade models and a recall of 68,500 units in the United States and Canada after a March 7 fatality in Ohio.
- Interim software updates simplify disabling the automatic-folding function and limit power-seat activation to when the tailgate is open; potential hardware remediation could cost about 100 billion won.
Risks and uncertainties
- Regulatory and legal exposure - The automaker could face class-action suits and punitive damage claims if hardware replacements or further liabilities are substantiated.
- Financial impact - If hardware replacement is required, Meritz Securities estimates a potential cost near 100 billion won, affecting automaker cash flows and capital allocation.
- Operational and reputational implications - Stopping sales of some high-end Palisade variants and ongoing investigations create uncertainty for production, inventory management, and consumer confidence in the model.