Inside Hyundai's US$16.6bn EV Supply Chain Boost

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Hyundai
Hyundai Motor Group announces record $16.6bn investment to enhance EV production, advance autonomous driving and expand R&D, strengthening its supply chain

Hyundai Motor Group is making waves in the global automotive sector with its ambitious plan to invest a record US$16.6bn.

The company is doubling down on EVs, hydrogen-powered products and cutting-edge technology in a bid to bolster its position in an uncertain global landscape.

The South Korean automaker, which holds the third spot in global vehicle sales behind Toyota and Volkswagen, announced it would increase domestic investment by 19% this year.

Highlighting its strategy, Hyundai said the move is designed to secure growth amid what it described as a “crisis” – a term widely interpreted to refer to current economic and political uncertainties around the globe.

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Hyundai’s substantial investment is split into several key areas.

Of the US$16.6bn, US$7.84bn will fund R&D into next-generation technologies. This includes advancing EV production, developing hydrogen-powered vehicles and pushing the boundaries of software-defined cars.

A further US$8.18bn is earmarked for retooling production lines to accommodate new models, particularly electric vehicles, as well as other standard investments.

Lastly, US$545m will support strategic ventures such as autonomous driving technologies, which are increasingly becoming a cornerstone of future mobility solutions.

In a statement, the group emphasised the importance of this investment, saying: “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.”

This comprehensive approach ensures Hyundai is prepared not just to weather current challenges but to capitalise on opportunities in an evolving market.

South Korean President Yoon Suk Yeol

Political uncertainty and market response

Hyundai’s announcement arrives during a period of political and economic instability, both at home in South Korea and abroad.

In South Korea, political turbulence has followed President Yoon Suk Yeol’s impeachment and declaration of martial law.

Meanwhile, on the international stage, Hyundai faces shifting trade policies in the US. President-elect Donald Trump has threatened to introduce a universal 10% tariff on imported goods, a move that could disrupt the company’s supply chain and exports.

Despite these challenges, Hyundai has already taken steps to mitigate risks. Last year, it began production at its new factory in Georgia, US, ensuring its EVs are eligible for tax credits under President Biden’s Inflation Reduction Act – a policy Trump has promised to repeal.

These strategic moves have not gone unnoticed. Following the investment announcement, shares in Hyundai Motor and its sister company Kia rose by 2.3% and 3.8% respectively, indicating investor confidence in the group’s long-term vision.

Nish Liyanage, Sales Director at MOVE, shared his perspective 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.

Nish Liyanage, Sales Director, MOVE at Terrapinn

"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.”

He added that Hyundai’s localisation of production in the US, alongside innovative initiatives like selling cars through Amazon, demonstrates its agility in adapting to shifting market conditions.

Shaping the future with sustainable goals

Hyundai’s focus on sustainability is clear, with its investment aimed at revolutionising the automotive landscape. By embracing EVs and hydrogen fuel cell technology, the company aligns with global efforts to transition to greener transport.

Hyundai’s push also highlights a shift towards digital transformation, with plans to streamline car sales through online platforms and reduce purchase times to as little as 15 minutes.

This forward-thinking approach not only addresses sluggish domestic demand but also positions Hyundai to compete effectively with emerging low-cost rivals. 

Hyundai Tucson

Hyundai’s numbers and best sellers

Established in 1967 and headquartered in Seoul, Hyundai Motor Group is a powerhouse in the automotive industry. Its leadership team includes Euisun Chung, Jaehoon Chang, and Dong Seock Lee. In 2023, the company recorded US$110.8bn in sales revenue, US$10.3bn in operating profit and total assets of $192.5bn.

Among its most popular models, the Tucson led global sales in 2023 with 656,867 units sold, followed by the Elantra (401,894), Creta (327,625), i10 (323,657) and Kona (279,862).

As Hyundai charts a course for the future, the company’s record-breaking investment signals its ambition to redefine the industry.


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