Hyundai boldly spends billions of dollars on electric cars because it ‘does not want to be left behind’

Amid increasing competition among automakers to position themselves for a low-carbon future, Hyundai Motor Group announced plans to invest a total of $16.5 billion over the next eight years to expand production capacity. produce electric vehicles in the Korean market.

The Korean conglomerate, which owns the Hyundai, Kia and Genesis brands, aims to produce 1.44 million electric vehicles a year in South Korea by 2030. This is part of its goal of capturing 12% of the vehicle market. Hyundai’s global electric power unit at the time, selling 3.23 million EVs a year worldwide.

“As the global auto market is transitioning to electric powertrains, major automakers have begun to announce plans,” said Soumen Mandal, senior research analyst at research firm Counterpoint. their ambitious EV plans and Hyundai doesn’t want to be left behind.”

He added: “Almost every automaker plans to convert their existing product portfolio to electric powertrains in the second half of the decade and stop developing combustion-engine vehicles. in”.

The global electric vehicle market is expected to grow as governments around the world demand to cut greenhouse gas emissions and adopt aggressive incentives for renewable energy. The market will be worth $957 billion by 2030 at a compound annual growth rate of 24.5% year over year, Market Research Future forecasts.

Last July, then-South Korean President Moon Jae-in revealed a plan to make South Korea the world’s top EV battery producer by 2030. LG, Samsung and SK were called to head. invested a total of $35 billion in facilities and R&D, in exchange for tax cuts of up to 50% and other benefits.

Hyundai alone plans to build a $5.5 billion battery and electric vehicle manufacturing facility in the US state of Georgia. This is part of an investment of more than 10 billion USD in the huge US auto market to stay ahead of the competition.

On May 20, Hyundai said that the factories will start commercial production from the first half of 2025 with an annual capacity of 300,000 units. Hyundai’s investment will help the US strike a balance between carbon reduction goals and new technologies.

Chris Robinson, research director at market analysis firm Lux Research, said Hyundai, like everyone else, will eventually produce electric vehicles domestically and export it to markets outside of its own. That approach saves shipping time, he noted.

According to Hyundai Motor Group, EV sales reached 76,801 units in the first quarter of this year, 73% higher than the same period last year. Hyundai anticipates creating cars with performance and value far beyond its competitors.

Production will continue to increase, Mandal said, mainly thanks to “Hyundai’s dominance in Korea”. Sales in 2030 could exceed that year’s target, he said, as Hyundai and Kia vehicles are popular in Europe, Southeast Asia and the US.

Robinson said some of Hyundai’s electric vehicles are “different” from their competitors. For example, its 800-volt cars can charge faster than others. According to him, Korea’s dense population could be the driver for the growth of electric vehicle use compared to other types of vehicles.

Hyundai Group is headed by billionaire Euisun Chung. He was appointed chairman of Hyundai Motor in 2020, succeeding his father, Mong-Koo Chung. As chairman of Kia from 2005 to 2009, Chung developed the Kia auto brand – which was a sub-brand – faster than Hyundai Motor.

You are reading the article Hyundai boldly spends billions of dollars on electric cars because it ‘does not want to be left behind’
at – Source: – Read the original article here

Back to top button