SEOUL / SINGAPORE (Reuters) – Hyundai Motor Co. has strengthened its holdings in the growing Southeast Asian markets with a $ 250 million investment in Singapore, Grab, its second in the stimulus company, for pursuing competitors in the race for transport.
FILE PHOTO: An employee lays the Hyundai logo on a vehicle at a Hyundai Motor plant in Asan, south of Seoul, February 9, 2012. REUTERS / Lee Jae-Won / Photo File
The investment is the largest ever by Hyundai in an automotive technology company, but is lower than that of companies such as Toyota Motor Corp. Nevertheless, it highlights the change in strategy of a South Korean conglomerate that has generally rejected partnerships for the development of its activities. own technologies.
Hyundai and its subsidiary Kia Motors Corp will launch electric vehicle pilot projects in Southeast Asia next year, starting with Singapore, where 200 electric vehicles will be leased to Grab drivers, Hyundai said in a statement.
The project will later be extended to countries like Malaysia and Vietnam, where traditional motor car markets are dominated by Japanese competition.
The decision comes as Hyundai tackles weak sales in its two largest markets, China and the United States, while its share price has fallen by nearly a third this year.
Hyundai has joined the global race for investment in mobility companies, as there is generally expectation that the number of individual car owners will decrease, due in particular to the increase in options for carpooling in the big cities.
"Not only Hyundai, but all global automakers have realized that generating revenue solely through vehicle sales is not a sustainable and viable option," Chi Young-cho, director of Hyundai, to the press.
"It's better to disrupt than be disturbed," he said.
Earlier this year, Hyundai announced it had invested $ 25 million in a 0.45% stake in Grab, joining investors such as Chinese firm Didi Chuxing, the Japanese group SoftBank Group Corp. and Toyota Motor Corp.
Grab said he has raised $ 2.7 billion, including Hyundai's latest investment, and is expected to attract more than $ 3 billion by the end of the year. Grab's chairman, Ming Maa, told Reuters that the company was not yet planning to go public.
The partnership will help reduce car ownership and operating costs for its drivers, Maa said. Cost reduction helps companies attract and retain customers.
Hyundai plans to launch its own car-pooling service in selected markets next year, said Chi, who oversees Hyundai's new activities, such as car pooling, artificial intelligence and robotics. He also said the builder was reviewing acquisition opportunities, without giving details.
The automaker aims to collect data on the battery charge of cars leased to Grab to develop vehicles better suited to Southeast Asia. He also hopes to explore the possibility of building a plant in the region in the longer term.
The electric vehicle market in Southeast Asia is very small. Only 142 battery-powered cars are expected to be sold in the market this year, compared with six last year, showed data from the LMC Automotive market research.
Sales of electric vehicles are expected to reach 693,894 units in China and 172,744 in the United States, according to LMC data.
Report by Hyunjoo Jin in Seoul and Aradhana Aravindan in Singapore; Edited by Sayantani Ghosh and Christopher Cushing