Aiming to Join Top 3 within 5 Years
Hyundai Motor and Kia Motors are making large-scale investments in electrification of vehicles. At the end of 2019, Hyundai Motor announced its “2025 Strategy” to investors. The automaker pledged to invest 10 trillion won in the electric vehicle sector over the next six years. The figure represented one sixth of its overall investment during the period. It plans to sell 560,000 electric vehicles (EVs) in 2025, becoming the world’s No. 3 in this sector.
Kia Motors announced its mid-to long-term strategy “Plan S” earlier this year. It pledged to invest 29 trillion won over the next six years to increase its EV models to 11 by 2025 and scale up the share of EVs in its total sales to 12.3 percent.
In the global EV market, Hyundai and Kia have already achieved remarkable results. They ranked 15th in EV sales in 2014, but their ranking jumped to 5th place in 2019. As of the first quarter of 2020, their sales volume stood at 24,116 units, placing fourth after Tesla (88,400), Renault and Nissan Alliance (39,355), and Volkswagen Group (3,846).
In particular, they are considered to be at the world's highest level in terms of mileage, excluding Tesla. Tesla vehicles swept the first to third spots in a mileage test held by Hybrid Cars, a U.S. media outlet focusing on hybrid cars, in 2019. Hyundai's Kona and Kia's Soul and Niro took 4th to 6th places, respectively. The Chevrolet Bolt and Nissan Leaf were ranked behind the Hyundai and Kia models.
Moreover, beginning January 2021, Hyundai and Kia will launch EVs produced through the Electric-Global Modular Platform (E-GMP). Auto industry insiders say that using an internal combustion engine platform to produce EVs is inefficient in space allocation and disadvantageous in improving fuel economy. In the end, a platform for EVs only is needed. They say that Hyundai and Kia are ahead of competitors in this aspect.
Securing stable and leading suppliers of batteries holds the key to securing a smooth flow of electrification. For this, Chung Eui-sun, senior vice chairman of Hyundai Motor Group, met with Samsung Electronics vice chairman Lee Jae-yong, extending the group’s business connection to Samsung SDI in addition to LG Chem and SK Innovation, which have thus far worked with Hyundai and Kia.