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Hyundai doubles down on EV investment

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Hyndai’s Ulsan Factory. FILE PHOTO (2006).

Hyundai Motor Group will commit 68 trillion won (USD $51 billion) over the next three years in South Korea to significantly enhance its electric vehicle (EV) production and ‘new mobility solutions’.

The investment spree, announced on Wednesday, also includes plans to bring on board 80,000 new employees, signaling a robust growth phase amidst a backdrop of cautious scaling back by other major car manufacturers, and a downturn in EV sales globally.

35.5 trillion won is earmarked for the development of cutting-edge research facilities and the construction of new assembly lines dedicated to EVs.

Hyundai’s global Chief Operating Officer, Jose Munoz, double-downed on the company’s ‘unwavering commitment’ to electrification. This includes a USD $12.6 billion investment announced last November for the establishment of a new dedicated EV and battery production facility in the state of Georgia – Hyundai’s largest overseas investment.

Hyundai Motor Group, which encompasses Hyundai Motor and its affiliate Kia, ranks as the third-largest automaker globally by sales. The conglomerate also includes auto parts manufacturer Hyundai Mobis and Hyundai Engineering & Construction.

This latest initiative comes as competitors are dialing back on EV production expansion, opting instead for investments in hybrid models or redistributing capital towards shareholder dividends and stock buybacks. General Motors have scaled down their EV ambitions, with planned facilities being postponed and production targets cut back.

Ford too have revised their EV production strategies, focusing more on traditional gasoline-powered models, and others like Toyota have opted to boost their hybrid vehicle sales, Hyundai remains steadfast in its electrification journey. Munoz told Reuters Hyundai would maintain its EV focus while remaining ‘adaptable’, including plans for plug-in hybrid vehicles.

Future offerings include the 2025 Tucson SUV, with hybrid and plug-in hybrid variants set to launch this summer in the US. The company anticipates starting EV production in Georgia by October, positioning itself to benefit from the U.S. Inflation Reduction Act’s $7,500 tax credits, ahead of its initial schedule.

The investment plan also outlines the transformation of a Kia factory for a new compact EV, aimed at both domestic and international markets, and the commencement of a second factory in 2025 for producing purpose-built EVs (PBVs), showcasing Hyundai’s vision for the future of commercial vehicles. The Ulsan factory in South Korea is set to start mass production of ultra-large luxury Genesis EVs by early 2026, with a significant portion of the funds dedicated to advancing electric vehicles, software-defined vehicles (SDVs), and battery technology research and development, ensuring Hyundai’s prominent position in the future mobility landscape.

Image credit: Anonyme, CC BY 2.5

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