Hyundai Motor Group has announced that it will set aside 81 trillion won ($80 billion) in the next three years for various investments that it hopes will raise the company’s global image and status for the next century.
This is equivalent to pouring 20.2 trillion won into investment and development every year, even 1 trillion won higher than the South Korean government’s R&D budget of 18.9 trillion won as of 2015.
“Through the investment, we will secure core technology essential for future vehicles such as eco-friendly cars and smart cars. Also we will be able to give a boost to its manufacturing by establishing global production line,” a Hyundai Motor spokesman stated.
“About 61.2 trillion won, or 76 percent of the entire budget, will be allotted to domestic affairs, thus contributing to the local economy,” he added.
Preparing for the post-8 million era
With the company’s annual car sales surpassing 8 million units worldwide, Hyundai is preparing for the next stage: enhancing its global competitiveness.
Company chairman Chung Mong-koo has previously stated, “The future of Hyundai Motor Group relies on how we secure innovative technologies and nurture creative talents.”
The investments will be made into local-focused cars, future vehicles including green cars, and the so-called premium cars.
About 11.3 trillion won will be allocated to developing plug-in hybrid and electric car as well as additional fuel cell cars, alongside their core parts such as motors and batteries.
Manufacturing plants will be established in the growing markets including China and Mexico, where the production of cars tailored to the respective regions will be reinforced. An additional 2 trillion won will be set aside to refine self-driving car technologies, alongside semiconductors development for such vehicles.
Securing technologies for audio, video and navigation platforms, development of lighter materials as well as futuristic seats and next-generation powertrains will be given a boost.
Enhanced fuel efficiency
Hyundai Motor Group also declared its “2020 Road Map” suggesting an overall 25 percent higher fuel efficiency for its Hyundai and Kia cars by 2020, from November 2014 levels.
A special task force was set up to develop next-generation powertrains that could replace 70 percent of the company’s engine lineups, starting with gasoline engines then swiftly moving onto others including turbo and diesel-powered engines. Improving the transmission is also a mission, seeking specification of its eight-speed power transmission.
The company expects this streamlining and development to enhance the average fuel efficiency by 11-13 percent for gasoline engine and 16-18 percent for diesel engines.
The use of advanced high-strength steel will also be raised to 48-62 percent in average, from the current 33-52 percent. This AHSS is known to enhance safety while minimizing the weight of the body, which contributes to the improved gas mileage, the company spokesman said.
Currently, the new Sonata, the new Genesis and the new Sorento has 52 percent of its body made with AHSS. The company plans to increase the use of aluminum wheels and others to shed weights from the body, too.
“The road map will be a preemptive measure against gas mileage regulations in our major markets such as Korea, Europe, the U.S. and others,” a Hyundai spokesman stated.
Global Business Center
The Hyundai Motor Group Global Business Center, which will be situated in the former Korea Electric Power Corporation headquarters site in Samseong-dong, southern Seoul, will become the control tower for all of these projects.
The 105-story building will host all Hyundai Motor Group affiliates, a 1,800-seat multifunction concert hall and a 600-seat concert hall on top of the exhibition and convention halls where events will be held to highlight Hyundai’s advanced motor technologies and others.
The company plans to invest 11 trillion won into real estate acquisition, construction and other administrative affairs for the company’s control tower by 2018.
By Bae Ji-sook(firstname.lastname@example.org)