Hyundai Motor Group is making plans to become one of the world’s top three makers of battery-electric vehicles by the end the decade, starting with an investment of $18 billion aimed at the EV sector.
The investment is designed to boost sales of Hyundai Motor, Kia and Genesis electric models and to expand the annual EV production in South Korea to 1.51 million units and global volume to 3.64 million units by 2030.
Hyundai aims to lead in EVs
By 2030, Hyundai Motor Group will have a total line-up of 31 EV models, including models from Hyundai, Kia, and luxury brand Genesis. Kia will launch the EV9, its first three-row seat electric flagship SUV, this year and Hyundai plans to launch the Ioniq 7 in 2024, following its current launch of the Ioniq 6.
“Our focus is to enhance the competitiveness of the entire electric vehicle ecosystem, including research and development, production, and infrastructure,” Kia President and CEO Ho Sung Song said in a statement on behalf of Hyundai Motor. Song added the investment would help South Korea become one of the “top three players in the global EV market” by 2030.
The ambitious goal puts the Hyundai Group and its various components in direct competition with Tesla, Chinese EV makers such as BYD and Polestar as well western rivals such General Motors, Ford, Stellantis, Volkswagen AG and Mercedes-Benz cars.
Hyundai’s announcement said the investment aims to upgrade Korea’s EV ecosystem and strengthen its role as a hub for driving innovation in the global automotive industry. It is also expected to promote a virtuous cycle of domestic EV production, R&D, infrastructure and related industries.
One positive sign for Hyundai the EV models it has introduced in the U.S. have gotten positive reception from consumers and the press.
EV investment supports broad strategy
A significant portion of the $18 billion investment will go for research and development, such as developing a platform for next-generation EVs, expanding product line-ups, developing core parts and advanced technologies, and establishing research facilities. It will also promote technology development with its partners.
The goal is to enhance the company’s hardware and software, through the diversification of dedicated platform product portfolios, advancement of power electric systems that are key to EV performance, such as batteries and motors, and development of technologies to increase all-electric range (AER) on a single charge.
The plans also call for developing dedicated platforms for each vehicle class under the Integrated Modular Architecture system, including the “eM” platform designed exclusively for passenger EVs, which will be introduced in 2025. Platforms using IMA architecture can standardize batteries and motors to increase product development speed and efficiency.
Part of Hyundai’s plans call for significantly expanding support for suppliers to play a leading role in accelerating the electrification transition of the auto parts industry and contribute to the qualitative growth of the South Korean auto industry.
As part of the plan, the Hyundai Group also will share cost burdens with its suppliers on the fluctuation of raw materials and reflect those changes in the prices of goods provided. It has paid about $2.5 billion, or the equivalent of 3.4 trillion South Korean won, for the increase in raw material delivery to more than 300 primary suppliers last year.
Through these strategic investments, the group plans to hone the Korean EV industry’s competitive edge to deliver unparalleled products and services that will drive the paradigm shift in the global mobility industry.
To help enhance suppliers’ liquidity, the group is establishing a fund to enable suppliers of internal combustion engine parts who wish to diversify their businesses, including the development of eco-friendly vehicle parts so that they can borrow business funds at low interest rates compared to the market.