Hyundai and Kia to recall 240,000 cars over whistleblower complaint

South Korea has ordered Hyundai Motors and affiliate Kia Motors to recall 240,000 vehicles over safety defects flagged by a whistleblower Kim Gwang-ho, a Hyundai engineer with 26 years at the company. 

The ministry has also asked prosecutors in Seoul to investigate whether the automakers allegedly covered up the five flaws, which affect 12 models, including the Elantra, Sonata, Santa Fe and Genesis. Hyundai and Kia, which had previously argued that the flaws presented no danger to driving safety.

This will be the first whistleblower case to hit South Korea's auto industry, Kim has made allegations about 32 problems to local regulators. The latest recalls covers five of those problems. Kim also flew to the United States last year to report safety lapses to authorities there and the automakers have since issued a voluntary recall for a combined 1.5 million vehicles in North America and in South Korea over a defect that could cause engines to stall. 

A Samsung Securities auto analyst Eim Eun-young said

 "what the whistleblower said turned out to be true. This is negative for Hyundai's brand image after the hit from the recall over engine issue last month. But then, its reputation is already seen at the rock bottom in South Korea, so I am not sure whether there is a room for a further fall."