Hyundai Motor revealed on Thursday its intention to cease operations at two long-standing parts forging plants in Ulsan, South Korea, in the coming year. The plants, in operation since 1991 and responsible for manufacturing engine parts, are slated for closure in January and October, respectively.
The strategic move aligns with Hyundai’s ongoing efforts to expedite the transition away from traditional petrol-powered vehicles. As the world’s third-largest automaker by sales, in conjunction with affiliate Kia Corp (000270.KS), Hyundai aims to progressively decrease the reliance on internal combustion engines in its finished cars, emphasizing a shift toward electrified vehicles.
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In November, the company marked a significant milestone by breaking ground on a 2 trillion won facility exclusively dedicated to the production of electric vehicles (EVs) in South Korea. The decision to shutter the two forging plants reflects Hyundai’s commitment to advancing its position in the rapidly evolving automotive landscape.
A spokesperson from Hyundai conveyed that the company is currently exploring the possibility of outsourcing certain engine components manufacturing tasks previously carried out at the Ulsan facilities. This strategic evaluation underscores Hyundai’s adaptability in response to the changing dynamics of the automotive industry.
