Hyundai Motor (KS:005380) (OTC:HYMLY) announced Tuesday that the Korean multi-national automaker plans to raise its average annual investment in electrification by nearly two-thirds to $28B over the next decade to restructure its business in China and boost electric vehicle (EV) sales.
Hyundai CEO Jaehoon Chang told investors that China, the world's largest vehicle market, had been very profitable up until 2016 but it was now the biggest risk as the automaker had lost market share to domestic rivals.
The world's No. 3 auto group by sales, together with its affiliate Kia, also announced at their annual investor day on Tuesday a revised goal to sell 2 million EVs by 2030, up from their previous goal of 1.87 million. The increase would represent around one-third of Hyundai’s total vehicle sales, up from 8% expected this year.
“Hyundai Motor is leveraging its heritage of innovation and knowledge accumulated over a long period of time … amidst seismic change in the industry with competition intensifying in a bid for leadership in the electric vehicle (EV) market,” the company said on its investor day.
To meet its targets, Hyundai plans to ramp up local production of EVs in the United States, Europe and South Korea. Three of the automaker’s key markets.
In the United States, EV production will account for three-quarters of its total vehicle production there by 2030 from just 0.7% now.
Other plans include forging partnerships with specialized companies and startups, as well as establishing joint ventures with battery manufacturers to ensure a reliable and consistent supply.
"Joint research and equity investment in startups to accelerate the development of next-generation batteries is also under way," the company said.
Its investment of KWD 35.8T ($28B) in electrification is part of a KWD 109.4T ($85B) budget Hyundai plans to spend through to 2032.