The South Korean automaker is pushing the envelope with electric vehicles.
(Photo: Reuters)
Tokyo When it comes to EVs, South Korea’s largest automaker, Hyundai, has done well in industry comparisons. On Tuesday, the group announced at its investor day that it would electrify its fleet faster than originally planned.
The group raised its sales forecast for 2030 from 1.87 to 2 million electric vehicles. This aims to increase their share of production to 34% from the current 8%.
The Korean also revealed how expensive the epoch-making change in the auto industry has been for the company. Hyundai wants to invest 109.4 trillion won, equivalent to 78 billion euros, over the next ten years. About a third will be used for electrification and battery technology, with the rest for the development of new vehicle architectures and the construction of new factories.
Another automaker has reacted to growing demand for electric vehicles and revised its plans upward. Last month, Toyota, the world’s largest automaker, announced it would increase sales of electric vehicles to 1.5 million by 2026, from the current tens of thousands. In turn, U.S. rival Ford hopes to sell 2 million all-electric models a year.
Hyundai has an edge here: With models like the Ioniq 5 and Ioniq 6 and versions from group brand Kia, the car company ranks fifth among global electric carmakers with sales of 109,000 vehicle year. Especially Japanese opponents who have long bet on hybrid vehicles can only dream at the moment.
The strategy is similar to that of other manufacturers: Hyundai hopes to significantly reduce development time and thus costs by developing a new vehicle architecture. The group has pledged to its investors to boost profit margins on electric vehicles to more than 10% by 2030. In 2022, the return on sales is 6.9%.
Hyundai is building its own electric car factory in the US
Hyundai counts Europe and the US as key markets. In Europe, Koreans are expecting rapid adoption of electric vehicles. The company predicts that EVs will increase their share of sales to 54 percent by 2030, from 7 percent today. But Koreans are also investing heavily in the US.
The manufacturer is building its own electric car factory for the U.S. market, with an annual capacity of 300,000 vehicles. In the future, 75 percent of the cars produced in North America will be electric—up from just 0.7 percent today. South Koreans are responding to pressure from the U.S. government to boost domestic production of key components for electric vehicles.
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However, the South Korean company lags behind its Japanese rival in one point. While Toyota, Nissan and Honda hope to introduce next-generation solid-state batteries in 2027 and 2028, the Koreans have yet to set a specific date.
Compared with previous batteries, solid-state batteries have no liquid but a solid electrolyte, so they can achieve twice the energy density and faster charging time. Japanese manufacturers hope the new technology will give them a distinct competitive advantage.
The South Koreans list autonomous driving, hydrogen technology including fuel cell drives, robotics and air taxis as further strategic growth areas. At the same time, Hyundai established a subsidiary Supernal in the United States to realize the dream of flying.
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