Hyundai Motor Group announced plans to increase its domestic investment by 19% to a record 24.3 trillion won ($16.65 billion) this year, citing the need for growth in the face of global economic challenges and political instability. The South Korean automotive giant, which includes Hyundai Motor and Kia, is the world’s third-largest automaker by sales, following Toyota and Volkswagen.
The group’s investment will prioritize research and development, with 11.5 trillion won allocated for advancing next-generation technologies such as electrification, software-defined vehicles, and hydrogen fuel-powered products. Another 12 trillion won will support the expansion of electric vehicle (EV) production and the development of new models, while 800 billion won is earmarked for strategic initiatives, including autonomous driving technologies.
As part of these efforts, Hyundai plans to introduce a new EV manufacturing technique, “hypercasting,” at its Ulsan production facility. The method, inspired by Tesla’s “Gigacasting,” simplifies production by using large single parts for key vehicle sections, reducing costs and improving efficiency. “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,” the group stated, without elaborating on the crisis.
Group Executive Chair Euisun Chung recently highlighted external risks such as economic recessions and geopolitical conflicts. The company also faces domestic uncertainty following political turbulence, including President Yoon Suk Yeol’s impeachment and declaration of martial law, which has weighed on consumer sentiment.
Hyundai and Kia aim to grow their combined global sales by 2% to 7.39 million vehicles by 2025, despite a sales dip in 2024 and unmet targets. Hyundai also seeks to navigate shifting U.S. trade policies, having started EV production at its Georgia facility last year to qualify for tax credits under the current administration. President-elect Donald Trump’s proposed 10% universal tariffs on imports and plans to scrap EV tax credits have prompted the group to adapt further.
Hyundai’s appointment of Jose Munoz as co-CEO, its first foreign national in the role, underscores its focus on tackling potential U.S. regulatory challenges. “This investment strategy demonstrates Hyundai’s commitment to innovation and resilience in the face of uncertainty,” the company noted.
