South Korean legacy automaker Hyundai Motor plans to suspend vehicle production at its main Asan factory to focus on the development of its new electric vehicle plant in Ulsan, Reuters reports, citing a regulatory filing.
Asan factory suspension
Hyundai is set to temporarily stop the operation of its Asan factory from December 31, 2023, to February 13, 2024.
The report noted that the South Korean automaker expects to resume production at the main factory the following day of the given end date.
Hyundai’s move to accelerate EV production is surprising, given the previous reports suggesting a market slowdown due to waning demand.
“I am still very bullish on the battery electrics.”
Jose Munoz, Hyundai’s global president (via Electrek)
Hyundai Ulsan factory development
Two weeks ago, Hyundai officially broke ground at its new $1.5 billion electric vehicle factory in Ulsan. It is the reason why the company suspended the main factory’s operation.
According to the report, Hyundai aims to focus on the development of this new factory to accelerate its EV production.
The Ulsan factory can hit an annual production capacity of 200,000 EVs when it becomes operational. Hyundai expects to finish the factory development in 2025.
It will rise in the company’s main Ulsan complex, which boasts an annual production output of 1.4 million vehicles. The mix includes the gas-powered Sonata and Grandeur and the all-electric Ioniq 6.
Growth
In the first nine months of the year, Hyundai managed to beat American legacy brands Ford and GM to become the second top-selling automaker in the US.
Hyundai-Kia sales also claimed a notable 7.5% of the market, as per registration data provided by Automotive News.
Tesla remains the industry leader, with a market share of 57.4%. Nonetheless, the Hyundai Ioniq 5 and Kia EV6’s sales continue to surge in October 2023.
This growth is undoubtedly remarkable, considering that Hyundai EVs do not benefit from federal tax credits of up to $7,500.
All these efforts are part of Hyundai’s wider strategy to advance as a top three global electric automaker by 2030. Therefore, expanding its production output is highly necessary to hit that target. It also recently partnered with tech giant Amazon to widen its distribution network.
