Hyundai and General Motors (GM) – the two largest carmakers in South Korea and the US, respectively – have signed an agreement to explore future partnership opportunities in a bid to drive down costs.
In a joint media statement, GM and Hyundai Motor Group (which includes Kia) announced they had signed a non-binding memorandum of understanding “to investigate joint product development, manufacturing and future clean energy technologies”.
The car giants are aiming to improve efficiencies and increase their competitiveness through the potential collaboration, amid a rise in more affordable Chinese vehicles threatening to take away their market share.
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Both companies will immediately begin assessing future opportunities and related binding agreements, which GM CEO Mary Barra said will complement each other.
“GM and Hyundai have complementary strengths and talented teams,” Ms Barra said.
“Our goal is to unlock the scale and creativity of both companies to deliver even more competitive vehicles to customers faster and more efficiently.”
“This partnership will enable Hyundai Motor and GM to evaluate opportunities to enhance competitiveness in key markets and vehicle segments, as well as drive cost efficiencies and provide stronger customer value through our combined expertise and innovative technologies,” said Hyundai Executive Chair, Euisun Chung.
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It’s expected the vehicle development will centre around electric vehicles (EVs), given the lofty targets of both companies.
GM is aiming for all of its light-duty passenger vehicles to be electric-only by 2035, while Hyundai wants its fleet to be battery powered globally by 2040.
Though both companies are currently successful in their own rights – with Hyundai ranking as the third-biggest carmaker globally, while GM dominates in the US – they’re at increasing risk of losing sales to Chinese competitors which have enjoyed government incentives.
It’s not the first time this decade that GM has announced a partnership with an Asian carmaker to jointly develop vehicles as a cost-cutting exercise.
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Honda Prologue
In April 2022, the US firm and Japanese brand Honda announced they would be “co-developing a series of affordable electric vehicles based on a new global architecture using next-generation Ultium battery technology”, starting in 2027.
According to Reuters, the deal was reportedly going to see the pair invest a total of US$5 billion (A$7.44 billion) towards EV development in a bid to undercut Tesla, however these plans for a cheap battery-powered model were scrapped in October 2023.
A year later, Honda revealed the Prologue SUV, based on GM’s BEV3 architecture which underpins models like the Cadillac Lyriq and upcoming Chevrolet Blazer EV. The Acura luxury division also released its own version in North America, named the ZDX.
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