South Korean automaker Hyundai Motor has just confirmed plans to produce hybrids at its electric vehicle-only factory in Georgia, CBT News reported.
Hyundai to add new HEV production line
During the Q1 2024 earnings call, Hyundai Chief Financial Officer Lee Seung Jo announced that the company will add a hybrid electric vehicle (HEV) manufacturing line to the new Georgia factory.
One of the planned HEVs to undergo production in the Bryan County factory is the Tucson. Notably, Hyundai originally intended to only produce BEVs in the local factory. However, it changed plans after the first quarter of 2024.
The move is apparently due to the longer-than-expected global electric vehicle industry slowdown.
“We are investing in facilities to produce hybrid cars at the Hyundai Motor Group Metaplant America.”
Hyundai CFO Lee Seung Jo
Rising demand for HEVs
During the recent earnings call, Hyundai executives said that the first three months of the year had witnessed “sharply rising hybrid demand.” It prompted the company to expand the Georgia plant to add a new HEV manufacturing line.
Hyundai acknowledged that more customers prefer HEV models due to their accessibility.
“There was a big decline in EV sales, but those of hybrids — a high-margin product—contributed to the high profitability.”
Hyundai CFO Seung Jo Lee
In response, Hyundai now sees the potential to introduce hybrid versions for all its models.
“We also plan to develop a system to apply hybrid (trims) to all models.”
Hyundai CFO Lee Seung Jo
The South Korean company also aims to boost its global HEV sales by 28% to 480,000 units in 2024.
These recent moves are crucial for the company to stay competitive amid the industrywide slowdown in electric vehicles.
Q1 2024 sales performance
Hyundai, including Kia, reported a 1.5% drop in global vehicle sales to 1.007 million units in Q1 2024, Reuters reported.
In South Korea, its sales dropped 16% due to surging inflation, a weak economy, and a temporary production suspension at the Asan plant. On the other hand, it reported a sales growth of almost 10% in the US market.
Hyundai’s global HEV sales increased by 17%, demonstrating customers’ growing preference for more affordable alternatives to BEVs. Therefore, it is unsurprising that the South Korean company now plans to increase its HEV capacity.
Hyundai expects the new hybrid-and-EV Georgia factory to start operations as early as Q4 of 2024. The new factory will have an initial annual capacity of up to 300,000 units, potentially reaching up to 500,000.
