Hyundai is launching a counterattack with EVs made in China next year

As many rivals are being squeezed out of China by low-cost EVs, Hyundai has a plan to fend off the competition. According to a new report, Hyundai is pouring resources into launching its first dedicated EV in China, due out next year.

Although electric vehicle sales continue climbing in China, the largest EV market globally, many legacy automakers are struggling to stay afloat.

According to the latest figures from the China Association of Automobile Manufacturers (CAAM) (via S&P Global), China sold a record 1.29 million new energy vehicles (EVs and PHEVs) in September, up 17% from August and 42% year over year.

As ICE cars continue falling out of favor, EV sales surpassed gas-powered car sales for the second consecutive month, with a 51.8% share of total vehicle sales last month.

Those who have been slow to transition are feeling the heat. Toyota, Volkswagen, GM, Honda, and others have all cut jobs in China as the market rapidly shifts to electric vehicles.

Hyundai has been no exception. Beijing Hyundai’s sales have been slumping since 2017. Through September, Korean automaker’s share of the China market dropped to just 1.2%.

However, Hyundai believes it can defy the market and turn things around. On October 18, Hyundai Motor China Advanced Tech and R&D Center became independent in Shanghai. The facility is Hyundai’s first overseas digital R&D center and will spearhead the automaker’s return.

Hyundai to launch EVs in China to fend off low-cost rivals

Yang Feng, the general manager of Hyundai’s new research and development facility, said in an interview with Shanghai news outlet Jiemian News that the company is launching its first dedicated EV for China next year.

Unlike other EVs, the dedicated model will be exclusively designed for buyers in China and will feature advanced new tech and designs.

Yang Feng, the first employee recruited by Hyundai China’s advanced tech R&D center, said the facility combines self-development with cooperation with local suppliers. It also includes leading tech suppliers.

According to local reports, Hyundai is partnering with Thundersoft, a smart cockpit provider, and Jianzhi Robotics, an intelligent driving supplier in China, to power its next-gen EVs.

Although Yang Feng admitted that Hyundai has struggled in recent years, the company hopes that by fusing its manufacturing expertise with local tech, it can quickly catch up with domestic automakers. Hyundai could even develop exclusive EV platforms for China.

Even some foreign brands that are pulling out of China now to protect profits will return for its smart tech, according to Fang Yinliang, McKinsey global director and partner.

“Whether it is foreign-funded auto brands or parts manufacturers, their investment in the Chinese market is likely to increase,” Yinliang explained. It’s not just about setting up R&D centers but investing in innovative Chinese companies “which will feed back to the global market.”

The tech from its new R&D center in China is not only expected to help boost sales in the region but could also be used for Hyundai and Kia’s global exports.

Electrek’s Take

Despite aggressive global expansion plans, Hyundai has had a minor presence in China. The automaker believes its new advanced tech R&D center will help turn things around quickly, with its first dedicated EV launching next year.

Hyundai is not the only automaker looking for China’s EV tech. Volkswagen expanded its partnership with XPeng with plans to launch the first co-developed EV for China in 2026.

Mercedes-Benz is investing heavily to launch a new intelligent driving EV (end-to-end capabilities) in 2026.

With Chinese automakers now looking overseas for growth in key markets like Europe, Southeast Asia, and Latin America, Hyundai and others are looking to launch a counterattack.

Source: Jiemian News