Seoul: Hyundai Motor Group announced its plan to invest 125.2 trillion won (US$86 billion) over the next five years in artificial intelligence (AI), robotics, and other future technologies, aiming to bolster its domestic manufacturing base.
According to Yonhap News Agency, this significant investment is intended to secure the group's "fundamental growth drivers" following a recent trade agreement between Seoul and Washington. The agreement, which reduced U.S. tariffs on imported Korean cars and auto parts from 25 percent to 15 percent, is seen as a crucial factor in this strategic move.
This investment initiative, the largest in Hyundai's history, was disclosed soon after Euisun Chung, the group's executive chair, met with President Lee Jae Myung and other business leaders, including Samsung Electronics Co. Chairman Lee Jae-yong. The meeting focused on implementing measures related to the tariff deal.
Chung had previously expressed gratitude to President Lee for the trade agreement during a meeting on the sidelines of the Asia-Pacific Economic Cooperation forum last month, as mentioned in a press release by the group.
The targeted investment for 2026-2030 exceeds the previous five-year investment of 89.1 trillion won by more than 40 percent, as stated by Hyundai. Of the total investment, 50.5 trillion won will be allocated to emerging sectors such as AI, software-defined vehicles (SDVs), and robotics. An additional 38.5 trillion won will be dedicated to research and development (R and D) projects, with 36.2 trillion won earmarked for production facilities.
Furthermore, the group plans to address U.S. tariffs imposed this year on key partner companies that supply parts to Hyundai Motor Co. and Kia Corp. plants in the United States. Analysts have estimated that the tariff reductions could result in savings of approximately 4 trillion won for Hyundai Motor Group.
The group reiterated its commitment to supporting South Korea's economic growth through substantial domestic investments and by enhancing assistance programs for partner firms, aiming to boost the competitiveness of the local automotive industry.