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South Korea's Hyundai will build two production lines for electric vehicles in 2021 and 2024 to boost its presence in the plug-in EV market, Reuters has reported, citing an internal newsletter.
The company has already had talks with battery producers, including Samsung, LG, and SK Group, likely in order to secure a stable supply of EV battery as the space heats up with virtually every carmaker of any significance either already marketing EVs or planning to do so over the medium term.
The South Korean carmaker already has a solid track record in EV sales: last year, Hyundai sold more than 86,000 EVs, which was more than Volkswagen sold but less than what Tesla sold. And it seems Tesla is the competitor that Hyundai has set its sights on, especially now that Tesla sales in South Korea overtook those of Hyundai's own EV, the Kona.
The South Korean carmaker has so far been more focused on hydrogen cars—one of few carmaking companies to invest heavily in the technology, which has lagged far behind EVs.
Reuters reports, citing an insider, that Hyundai had not paid Tesla much attention while it only manufactured luxury cars. Now that the company launched the Model 3 and its sales helped it report its first-ever annual profit, things have changed for Hyundai, which is the world's fifth-largest car manufacturing company.
Last year, EV sales tolled 2.2 million, but this year they could plunge by as much as 43 percent, according to Wood Mackenzie. That's because of the travel restrictions in response to the coronavirus pandemic and a global economic slump that will likely dampen consumers' appetite for big buys such as cars. The sales slump will not be limited to the EV space, however, and once economies begin to rebound, analysts believe so will interest in EVs.
By Irina Slav for Oilprice.com
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Irina is a writer for Oilprice.com with over a decade of experience writing on the oil and gas industry.