How Sustainability Underpins Hyundai’s US$16.6bn Investment

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Hyundai
Hyundai Motor Group, including Kia Corp, wants EVs and hydrogen-fuelled products to be centre stage as it invests a record sum in its development

Global motor industry giant Hyundai Motor Group is prioritising electric vehicles and hydrogen-fuelled products as part of a record US$16.6bn investment.

The South Korea-headquartered company, which ranks third in global vehicle sales behind Toyota Motor and Volkswagen, announced the plan to boost domestic investment by 19%.

Making the announcement, the company talked of securing growth during a “crisis” – a word believed to refer to global economic and political uncertainties.

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Where is the money going?

The planned investment by Hyundai Motor Group includes US$7.84bn in research and development for next-generation products, electrification, software-defined vehicles, hydrogen-fuelled products and other technology.

It also plans to spend US$8.18bn on more standard investments including adjusting production lines to make electric vehicles and new models and US$545m on strategic investments including for autonomous driving.

The group said: "Hyundai Motor Group is making the largest investment ever in South Korea this year because it believes that continuous and stable investments are essential to overcome the crisis and secure future growth engines in the face of growing uncertainties.”

South Korean President Yoon Suk Yeol

The political landscape

Shares in Hyundai Motor and Kia were up 2.3% and 3.8% respectively in early trade after the news.

The announced investment by Hyundai is a welcome piece of good news during a time of political and economic uncertainty in South Korea.

Hyundai Motor Group Executive Chair Euisun Chung recently referred to a recession and global conflicts as external risks. 

The political uncertainty follows President Yoon Suk Yeol's declaration of martial law and his impeachment.

In the United States, President-elect Donald Trump has threatened to impose universal 10% tariffs on imported goods.

Hyundai Motor started production at a new factory in the US state of Georgia last year to make its vehicles eligible for the Biden administration's tax credits, which Trump threatened to scrap.

Nish Liyanage, Sales Director, MOVE at Terrapinn

Setting the stage for a sustainable future

Nish Liyanage, Sales Director, MOVE at Terrapinn, provided this analysis of Hyundai’s investment on LinkedIn.

“Hyundai Motor Company's record US$16.7bn investment in South Korea showcases its commitment to leading the EV revolution and overcoming global challenges.

“With plans to enhance EV production, advance autonomous driving technology and expand R&D, the world’s third-largest automaker is setting the stage for a more sustainable future.”

Nish added: “As Hyundai braces for geopolitical pressures, including potential US tariffs, it’s leveraging opportunities like the Inflation Reduction Act, making its EVs eligible for tax credits.

“Localizing production in the US, Hyundai's key market, and exploring digital sales channels like Amazon further highlight its adaptability and innovative edge.”

He said the strategic shift addresses sluggish domestic demand and positions Hyundai to compete globally with low-cost rivals, adding: “Its vision to streamline online car sales and reduce purchase time to 15 minutes reflects a bold approach to automotive retail.”

Hyundai Tucson

Hyundai in numbers

Hyundai Motor Company, which is based in Seoul, South Korea, was established in 1967.

Its CEOs are Euisun Chung, Jaehoon Chang and Dong Seock Lee.

Its 2023 figures include:

  • Sales revenue: US$110.8bn
  • Operating profit: US$10.3bn
  • Total assets: US$192.5bn.

Globally, its best selling car models in 2023 were:

1 – Tucson (656,867 sold)

2 – Elantra (401,894)

3 – Creta (327,625)

4 – i10 (323,657)

5 – Kona (279,862).


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