Hyundai Motor Co., South Korea's top automaker, plans to launch subcompact hybrid electric vehicles next year to target the global market with eco-friendly cars, industry sources said Monday.

Hyundai has been developing the hatchback subcompact hybrid model under the name AE, which is designed to improve fuel efficiency by combining a 1.6-liter gasoline engine and an electric motor, according to company officials.

Kia Motors Corp., its smaller affiliate, also plans to launch the same platform under the name DE, they said.

After launching the new models, the two automakers plan to add a plug-in hybrid lineup next year, officials noted.

Separately, Hyundai Motor is preparing to launch its first dedicated EV model next year to compete with the market leader: the Toyota Prius. Market watchers think the new model could exceed the Prius in fuel efficiency and price affordability.

The South Korean automakers have been stepping up efforts to expand electric vehicle models in the wake of Volkswagen's emission cheating scandal. (Yonhap)