Hyundai, GM joint venture gains momentum

HYUNDAI and General Motors’ limited alliance to co-develop five new models for delivery commencing 2028 is on track with Hyundai Motor Company chief executive officer Jose Munoz announcing an update on the program at a recent Investor Day presentation in New York.

“This alliance is a powerful example of how we scale faster, smarter and more sustainably together,” he said.

“The GM project is a very important one, and the most important is the alignment at the top.”

As reported previously, Hyundai will lead the development of a commercial electric van for North America as well a compact (small) crossover, sedan and pickup for Central and South America while GM will lead the development of the mid-sized pick-up for the region.

With strong support from GM chief executive officer Mary Barra, the move is aimed at expanding market share while reining in costs with the elephant in the room being Chinese competition.

The tie-up is further enhanced by strong executive-level cooperation between HMC executive chair Euisun Chung who, with Mary Barra has established “momentum” for the plan.

Sources say both Mr Munoz and Ms Barra agree that leveraging combined scale and shared efficiencies will help the two companies stay competitive.

The alliance may yield 800,000 annual sales for the pair once scaled, with Mr Munoz estimating volume of 100,000 vehicles in the early stages.

According to reports, the tie-up will leverage GM’s product expertise and Hyundai’s manufacturing footprint with the current focus of the project Latin America.

The Hyundai/GM tie-up further facilitates a sharing of development costs and technology while boosting competitiveness to off-set heavy investments in electrification and tightening regulatory demands relating to emissions, safety … and tariffs.

Similar alliances are being discussed elsewhere including among some Japanese manufacturers Nissan, Mitsubishi, Toyota and Honda for example, all with similar objectives.

An Automotive News report says such collaborations allow companies to pool resources while tailoring products to regional needs.

Going into more detail, Mr Munoz said Hyundai is exploring a broad range of collaboration opportunities with GM in the areas of logistics, steel, propulsion systems, battery supply chain and fuel cell technology.

He said Hyundai already provides logistics services to GM through its Glovis affiliate, transporting vehicles from Asia to the US so there could be further opportunities to support GM’s vehicle exports from the US.

Moving to product development between the two we find it will be structured around “clear leadership roles for each model”.

“When it comes to the product development, the policy is very simple, there is a donor and a receiver of a particular product,” added Mr Munoz.

“The donor takes the lead, and the receiver takes advantage of that particular platform or model.”

Accordingly, Hyundai will lead the development of the commercial electric van in North America as well as the compact vehicles in Central and South America, while GM will lead the development of the mid-size pick-up in the region.

Mr Munoz made it clear that maintaining the donor-receiver structure would be critical to the alliance’s success.

“We are not going to mix everything to try to do a hybrid - that is not going to work,” continued Mr Munoz.

“We’re just scratching the surface; I think we can do much more together.”