Athira Sethu
Kochi, 9 January 2025
Hyundai Motor Group on Thursday said it would increase investment in South Korea 19% this year to a record 24.3 trillion won, or around $16.65 billion. The group, which consists of Hyundai Motor and Kia, is the third-largest vehicle seller globally, behind Toyota and Volkswagen, but faces instability at home with an opposition president elected last week and uncertain economic conditions in the US.
The planned investment will be centered on several critical areas. In this regard, Hyundai will focus 11.5 trillion won on research and development. Of this amount, the funds would be channeled to next-generation products, EVs, software-driven vehicles, hydrogen-powered cars, and other innovative technologies. There is a remnant of 12 trillion won, which the group will put into general investments, such as expanding electric vehicle production and releasing new models. In addition to that, it will spend an approximate 800 billion won in strategic areas such as autonomous driving.
As part of this plan, Hyundai will set up a new plant at its Ulsan production site to work on a new “hypercasting” manufacturing method for EVs. This would be similar to Tesla’s “Gigacasting,” where massive parts of vehicles are cast all at once. It is supposed to make production easier and less expensive.
Hyundai stated that the record investment will help overcome present difficulties and bring about long-term growth. Even though the company did not specifically indicate what kind of crisis they are facing, they mentioned worldwide uncertainties such as recession and political instability.
Hyundai Motor Group’s Executive Chair, Euisun Chung, recently noted the threats that global economic slowdowns and conflicts posed. Hyundai shares had some mixed movements, while Kia’s shares rose 2.3% in early trade.
Hyundai and Kia also announced a plan to grow their combined global sales by 2% in 2025 to 7.39 million vehicles, after missing their targets in 2024.
South Korea: Consumer confidence at home was sharply lower in December 2024 than at any other time since the pandemic, with the decline partly political. The United States: President-elect Trump threatens to apply stiffer tariffs to imported goods; this is going to hit Hyundai hard, for example, although the latter is trying to build a car manufacturing plant in Georgia, USA to attract tax credits that will become threatened under a Trump administration.
