How It Works: Hyundai Evolve Retail Financing

Hyundai is introducing a leasing-like financing option on all of its new electric vehicles and plug-in hybrid electric vehicles. It’s called Hyundai Evolve Retail and involves balloon financing with benefits to know if you’re about to buy or lease. Here’s a look at how Hyundai Evolve Retail works and whether it can be a good deal or not.

How does Hyundai Evolve Retail work? Hyundai Evolve Retail refers to a type of lump sum financing and is only available when financing a car through Hyundai Motor Finance (HMF), Hyundai’s captive lender. Unlike a traditional purchase, Hyundai Evolve Retail offers four different choices after the payment term of 36, 48 or 60 months has passed.

These choices include:

  • Keep the vehicle by paying the lump sum payment
  • Keep the vehicle and refinance the lump sum payment with HMF ($250 refinance fee applies in some states)
  • Trade in or sell the vehicle and use any equity for the down payment on a new car
  • Return vehicle to HMF ($400 disposal fee applies)

Which models are eligible for Hyundai Evolve Retail? For now, only new Hyundai electric vehicles and PHEVs with less than 1,000 miles and untitled demonstration and service vehicles with up to 6,000 miles are eligible. Also, this program is not available in all 50 states.

Eligible states are Alabama, Arkansas, Arizona, Colorado, Florida, Georgia, Idaho, Kansas, Louisiana, Missouri, Mississippi, Montana, North Carolina, North Dakota, Nebraska, New Mexico, Oklahoma, South Carolina, Tennessee, Texas, Utah and Wyoming.

Hyundai Evolve Retail Benefits. The biggest benefit for most buyers might be a low payout with drive allowance flexibility. Annual allowances of 12,000 and 15,000 miles are available. For reference, leases generally provide these benefits, but HMF does not forward a federal tax credit on the Ioniq 5 when renting.

Hyundai Evolve Retail is a good deal for other reasons, too. This method of financing can potentially offer promotional rates that you cannot obtain by leasing. Plus, buyers with a credit score of 620 and above are eligible to participate in this program, and to further sweeten the deal, loyal customers can get a 2-tier rate improvement on their credit score.

Disadvantages of Hyundai Evolve Retail. The final lump sum payment, if you decide to keep your car, can be scary. For example, Hyundai’s estimated final lump sum payment on a 2022 Ioniq 5 SEL RWD is over $17,000, assuming $0 down payment and 4.89% APR for a 60 month term with indemnity of 12,000 mile annual drive.

Alternatively, the same Ioniq 5 with a 36-month term and the same annual driving allowance will have an estimated final lump sum payment of just under $25,000, assuming a $0 down payment and an APR of 4.69%.

What Hyundai Evolve Retail is not. Hyundai Evolve Retail should not be confused with Hyundai Evolve – Hyundai and Amazon’s collaborative virtual showroom that was introduced during the coronavirus pandemic to help with car buying when the country was on lockdown – and Hyundai Evolve+ – a subscription-based mobile app that allows customers to try out a Hyundai EV with maintenance, insurance and roadside assistance included.

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