Hyundai Motor Group to boost domestic investment by 19%
Hyundai Motor boosts domestic spending to drive growth in uncertain times
Hyundai Motor Group has unveiled plans to increase its domestic investment by 19% this year, aiming to reach a record 24.3 trillion won ($16.65 billion).
The decision, announced Thursday, reflects the company’s strategy to secure future growth despite ongoing economic and political challenges. Hyundai Motor Group, which includes both Hyundai Motor and Kia Corp, ranks third in global vehicle sales, trailing only Toyota and Volkswagen, reports Reuters.
The group’s ambitious investment will be directed toward next-generation products, electrification, hydrogen-fuel technology, and software-defined vehicles. Specifically, 11.5 trillion won will be allocated for research and development efforts, while another 12 trillion won will go toward revamping production lines for electric vehicles and new models. An additional 800 billion won will fund strategic initiatives, including autonomous driving technology.
Navigating uncertainty and competitive pressures
This record investment comes at a time of significant uncertainty. Hyundai's Executive Chair Euisun Chung recently highlighted global recessions and geopolitical conflicts as risks to the company’s prospects. While the specific crises Hyundai faces were not detailed, the group’s emphasis on stability through continuous investment suggests a strategic response to these external pressures.
Hyundai has also encountered challenges in its home market, where consumer sentiment fell sharply in December, the largest decline since the 2020 pandemic. This drop was attributed to political uncertainty surrounding President Yoon Suk Yeol’s declaration of martial law and his impeachment.
The U.S. market presents additional complications. With President-elect Donald Trump threatening to impose tariffs on imported goods, Hyundai’s production efforts in Georgia — aimed at benefiting from tax credits under the Biden administration — are now under scrutiny.
Looking ahead: strategic growth amidst challenges
Hyundai and Kia aim for a modest 2% increase in global sales in 2025, targeting 7.39 million vehicles after a disappointing 2024. The companies’ commitment to innovation through significant investment underscores their determination to overcome global uncertainties and strengthen their position in the rapidly evolving automotive sector.
Additionally, Honda Motor Co. Ltd. shares soared 13.55% in Tokyo trading on Dec. 24, their biggest one-day gain since 2008.
