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Hyundai Motor Company's Progress in Electric Vehicles (EV) and Sustainability Initiatives in 2024

GOOVER DAILY REPORT September 8, 2024
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TABLE OF CONTENTS

  1. Summary
  2. Expansion of Electric Vehicle (EV) Portfolio
  3. Advancements in Hydrogen Fuel Cell Technology
  4. Sustainability and Environmental Initiatives
  5. Market Competitiveness and Strategic Collaborations
  6. Governance and ESG Management
  7. Conclusion

1. Summary

  • This report provides a comprehensive analysis of Hyundai Motor Company's advancements in the electric vehicle (EV) sector and sustainability initiatives as of 2024. Key components include the introduction of the 2025 IONIQ 5, plans to expand Hyundai's EV lineup to 21 models by 2030, and substantial incentives for EV purchases. Notable developments in hydrogen fuel cell technology are highlighted by the XCIENT Fuel Cell trucks surpassing 10 million kilometers of operational use and innovations in hydrogen production methods. Furthermore, Hyundai’s sustainability commitments include partnerships with Healthy Seas for ocean clean-up projects and achieving RE100 status at their Indonesian plant. Market competitiveness is underlined by record sales in North America, strategic partnerships such as with Exide Energy Solutions for battery localization in India, and enhanced governance structures focusing on ESG compliance. These efforts collectively emphasize Hyundai’s comprehensive strategy to lead in both market competitiveness and environmental stewardship.

2. Expansion of Electric Vehicle (EV) Portfolio

  • 2-1. Introduction of the 2025 Hyundai IONIQ 5

  • Hyundai introduced the 2025 IONIQ 5, which is a significant update to their existing electric vehicle lineup. This vehicle has been well-received and is part of Hyundai's strategy to enhance their position in the electric vehicle market.

  • 2-2. Plans to expand the EV lineup to 21 models by 2030

  • Hyundai has outlined its ambitious plan to expand its electric vehicle lineup to 21 models by the year 2030. This initiative is part of the new strategy announced during the 2024 CEO Investor Day, known as the 'Hyundai Way'. The strategy includes enhancing EVA and hybrid competitiveness, with a total projected sales target of 2 million EVs by 2030.

  • 2-3. Substantial cash rebates for EV purchases

  • Hyundai has implemented substantial cash rebates for the purchase of electric vehicles, aiming to incentivize consumers to opt for EVs over traditional combustion engines. This strategy is essential in promoting their electric vehicle offerings and supporting the transition to greener alternatives.

3. Advancements in Hydrogen Fuel Cell Technology

  • 3-1. Milestone of XCIENT Fuel Cell trucks surpassing 10 million km

  • As of June 12, 2024, Hyundai Motor Company’s XCIENT Fuel Cell electric heavy-duty trucks have achieved a cumulative driving distance of over 10 million kilometers in Swiss fleet usage, showcasing the reliability and efficiency of their hydrogen fuel cell technology.

  • 3-2. Expansion of HTWO fuel cell system lineup

  • Hyundai Motor Company is expanding its HTWO fuel cell system lineup, which indicates their commitment to diversifying and enhancing hydrogen energy applications for various sectors including mobility and logistics.

  • 3-3. Innovative hydrogen production methods like W2H and P2H

  • Hyundai is innovating hydrogen production techniques through methods such as Waste-to-Hydrogen (W2H) and Plastic-to-Hydrogen (P2H). These production methods highlight the company's dedication to advancing sustainable energy solutions and leading the global energy transition.

4. Sustainability and Environmental Initiatives

  • 4-1. Collaboration with Healthy Seas for ocean clean-up

  • In June 2024, Hyundai Motor Company announced a collaboration with Healthy Seas, launching a significant clean-up initiative along the western coast of Greece. This operation is part of Hyundai's broader commitment to environmental sustainability and aims to tackle ocean pollution.

  • 4-2. Efforts in human rights management and ESG risk management

  • Hyundai has strengthened its human rights management practices in 2024 by revising its Human Rights Charter and expanding human rights due diligence processes. The company actively supports its suppliers to identify and mitigate ESG-related risks, promoting sustainable growth and fostering a healthy work environment.

  • 4-3. Investment in environmental management systems and achieving RE100

  • Hyundai has been proactive in environmental management, adopting an Environmental Management System certified by ISO 14001 across its domestic and international production facilities. Notably, in 2023, the company achieved RE100 status at its Kota Deltamas plant in Indonesia, which now utilizes 100% renewable energy. Furthermore, the total renewable energy usage across Hyundai's global operations increased by 69% from 2022.

5. Market Competitiveness and Strategic Collaborations

  • 5-1. Record sales and corporate accomplishments

  • As of August 2024, Hyundai Motor America achieved record sales, benefiting from the success of their eco-friendly models, particularly the IONIQ 6 and the IONIQ 5. The company obtained six awards in the 2024 Newsweek Autos Awards, including the Best Vehicle for First-time New Car Buyers for the Hyundai Elantra. Additionally, Hyundai was recognized as the top mass-market brand in J.D. Power’s U.S. Tech Experience Index Study for the fifth consecutive year.

  • 5-2. Strategic pursuits during 2024 CEO Investor Day

  • During the 2024 CEO Investor Day, Hyundai Motor Company revealed its mid- to long-term strategy, termed ‘Hyundai Way’. This strategy focuses on enhancing competitiveness in the electric vehicles (EV) and hybrid markets, along with advancements in battery and autonomous vehicle technologies. The firm announced ambitious global sales targets, including plans to expand its hybrid lineup from 7 to 14 models, and a full EV lineup of 21 models by 2030. Furthermore, S&P Global upgraded Hyundai’s credit rating from ‘BBB+’ to ‘A-’, acknowledging a stable outlook for the company.

  • 5-3. Collaboration with Exide Energy Solutions for EV battery localization in India

  • Hyundai Motor Company and Kia Corporation entered into a strategic partnership with Exide Energy Solutions Ltd. This collaboration aims to localize the production of electric vehicle batteries in India, thereby increasing the sustainability of battery sourcing and fostering the localization strategy within the EV market.

6. Governance and ESG Management

  • 6-1. Evaluation and engagement of suppliers based on ESG criteria

  • Hyundai Motor Company has developed standard contract templates that incorporate ESG (Environmental, Social, and Governance) assessment results as criteria for supplier engagement. Effective from 2024, suppliers failing to meet certain ESG criteria, such as renewable energy usage rates, risk being excluded from future contracts. The company has initiated this process to enhance ESG compliance across its supply chain, which includes over 5,000 suppliers.

  • 6-2. Investment in governance structures and shareholder value enhancement

  • Hyundai is continuously investing in enhancing its governance framework to maximize shareholder value. The governance system emphasizes transparency, diversity, and ethics, supported by a Board of Directors (BOD) that includes a majority of independent directors. This structure aims to equip the company to respond to various risks while upholding the interests of stakeholders.

  • 6-3. Implementation of human rights and ethical management systems

  • Hyundai has committed itself to robust human rights management practices across its operations and supply chain, adhering to international standards and guidelines. The company conducts annual due diligence assessments to identify human rights risks and implements measures to address them. Moreover, Hyundai promotes a corporate culture that enhances ethical management awareness through training and a defined grievance handling process. Notably, the company has established a Human Rights Charter, emphasizing zero tolerance for forced and child labor.

7. Conclusion

  • Hyundai Motor Company’s 2024 strategies underscore a robust commitment to leading the automotive industry through innovation in electric vehicles and sustainable practices. With the introduction of models like the IONIQ 5 and plans to expand the EV lineup, Hyundai is positioned to significantly impact the EV market. The advancements in hydrogen fuel cell technology, exemplified by the XCIENT Fuel Cell trucks, demonstrate the company's pioneering role in clean energy solutions. Collaborations with entities like Healthy Seas and adherence to the RE100 initiative emphasize Hyundai's broader commitment to sustainability. However, continuous integration of sustainable practices and rigorous ESG risk management are essential to maintain this trajectory. The company’s achievements in governance, market competitiveness, and strategic collaborations, such as with Exide Energy Solutions, illustrate a balanced approach to profitability and environmental responsibility. Future prospects may see Hyundai further solidify its position as a leader in sustainable mobility, yet it must remain vigilant in addressing any ESG-related challenges to ensure long-term success and impact.

8. Glossary

  • 8-1. Hyundai Motor Company [Company]

  • A major South Korean automotive manufacturer actively expanding its electric vehicle portfolio and advancing sustainability initiatives. Hyundai aims to lead the future of mobility with a focus on environmentally friendly technologies and strategic international collaborations.

  • 8-2. IONIQ 5 [Product]

  • A fully electric vehicle model introduced by Hyundai, which symbolizes the company's innovative approach in the EV market. Significant for its advanced features, local manufacturing in North America, and attractive buyer incentives.

  • 8-3. XCIENT Fuel Cell [Technology]

  • Hyundai's hydrogen fuel cell technology used in heavy-duty trucks. The XCIENT Fuel Cell trucks have surpassed 10 million kilometers of travel in Switzerland, showcasing reliability and sustainability in transportation.

  • 8-4. Healthy Seas [Organization]

  • A non-profit organization working in partnership with Hyundai for ocean clean-up initiatives. The collaboration underscores Hyundai's commitment to environmental stewardship beyond the automotive industry.

  • 8-5. Exide Energy Solutions [Company]

  • A strategic partner with Hyundai for electric vehicle battery localization in India. This collaboration supports Hyundai's goal of enhancing its EV supply chain and market presence in India.

  • 8-6. RE100 [Initiative]

  • A global initiative encouraging corporations to commit to 100% renewable electricity. Hyundai’s participation in RE100 highlights its dedication to reducing environmental impact and moving towards sustainable energy solutions.

9. Source Documents