South Korea’s hydrogen car market is in trouble. After years of government subsidies and bold promises, sales of fuel cell vehicles (FCVs) like Hyundai’s Nexo have plummeted—dropping 54% in 2023 compared to the previous year. Now, Hyundai is trying to revive demand with a new financial incentive program, but will it be enough to overcome hydrogen’s biggest hurdles?
The Deal: Hyundai’s “Nexo Easy Start Program”
Hyundai’s latest move, launched in August 2025, is designed to make buying a hydrogen car less daunting. The program has two key parts:
- Deferred Payment Plan – Buyers can delay paying 50% of the Nexo’s price (around $51,000) until they return the car. They only pay interest on the deferred amount, lowering upfront costs.
- Hydrogen Fuel Subsidy – Hyundai covers $1,750 in hydrogen fueling costs over two years (about $73 per month).
Sounds good, right? But there’s a catch: When the contract ends, you must return the car and buy another Hyundai EV or hydrogen vehicle. Essentially, it’s a lease with strings attached.
Will This Actually Boost Sales?
Hyundai is clearly trying to reduce sticker shock and ease fueling costs, but the bigger question is whether this fixes hydrogen’s deeper issues.
1. Hydrogen Fueling Stations Are Still Too Scarce
- South Korea has 220 hydrogen stations, but most are clustered in Seoul and Busan. Outside these areas, refueling is a headache.
- Globally, hydrogen stations are struggling to stay open. California and Denmark have seen closures due to low demand.
- Without more stations, even a subsidized Nexo is a tough sell.
2. Hydrogen Fuel Is Still Too Expensive
- Even with Hyundai’s $73/month credit, hydrogen costs about twice as much per mile as charging an EV at home.
- Unsubsidized, hydrogen is 4x more expensive than gasoline in some markets.
- Until green hydrogen production scales up, prices won’t drop enough to compete.
3. The Nexo Is Still Pricier Than EVs
- The Nexo costs $51,000—double Hyundai’s own Ioniq 5 EV.
- EVs have more charging stations, lower running costs, and better performance.
- Unless buyers are hardcore hydrogen believers, why choose the Nexo?
Is Hydrogen Doomed for Passenger Cars?
Hyundai’s incentives are a short-term fix, but hydrogen’s future might lie elsewhere:
- Buses & Trucks: Fuel cell buses are growing 25% yearly (China leads here). Fixed routes make refueling easier.
- Industrial Uses: Steel, shipping, and aviation may adopt hydrogen before cars do.
- Government Policy: If subsidies dry up (as they have in Europe), FCV sales could collapse.
Hyundai’s new deal makes the Nexo cheaper to own, but it doesn’t solve hydrogen’s infrastructure and cost problems. Until those improve, even the best financing plans might not be enough to make hydrogen cars mainstream.
