Hyundai considers strategic collaboration with GM
Hyundai and GM discuss commercial EV supply partnership amid sales slowdown
Hyundai Motor announced on Thursday that it is in discussions with General Motors (GM) to supply commercial electric vehicles (EVs) to its U.S. counterpart.
The talks extend to various collaborative opportunities, including joint parts purchasing and passenger vehicle partnerships. Hyundai expects binding agreements to be finalized within the year, reports Reuters.
Uncertain Market Conditions
The move comes as global carmakers face increasing uncertainty, particularly in the U.S., the world’s second-largest auto market. President Donald Trump recently proposed a 25% import tariff on vehicles from Canada and Mexico, set to take effect on February 1.
This policy, coupled with tightening emissions regulations in Europe, has heightened concerns for Hyundai, which warned of growing economic volatility and slowing EV demand.
Hyundai, the world’s third-largest carmaker when combined with affiliate Kia, forecasted revenue growth of 3.0% to 4.0% for 2025—a significant drop from the 7.7% growth achieved in the previous year. The company anticipates an operating margin of 7.0% to 8.0%, slightly lower than 2024's 8.1%.
For the fourth quarter of 2024, Hyundai reported an operating profit of 2.8 trillion won ($1.95 billion), falling short of analysts' expectations of 3.2 trillion won, as compiled by LSEG SmartEstimate.
Solid sales in the U.S. and India were offset by weaker demand in South Korea, Europe, and China. Additionally, a weaker South Korean won boosted repatriated earnings but increased foreign debt costs, negatively impacting profitability.
Policy and EV Challenges
Hyundai also faces challenges in the EV market. President Trump has suggested removing EV purchase tax credits, which could reduce consumer incentives and further slow EV adoption. Hyundai CFO Lee Seung Jo emphasized the need to navigate these uncertainties while adjusting to stricter emissions rules in key markets.
Hyundai’s collaboration with GM highlights its efforts to strengthen its EV business amid challenging conditions. As the company adjusts to macroeconomic pressures and shifting policies, its ability to secure partnerships and adapt its strategy will be critical to maintaining global competitiveness.
Earlier this month, 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).
