Amid escalating uncertainties in the management environment due to tariffs from the United States and the electric vehicle offensive from China, Hyundai Motor Group is expanding collaboration with major corporations. The aim is to establish alliances in areas such as finished vehicles, batteries, steel, and information technology (IT) to respond to internal and external variables and enhance competitiveness.
Hyundai Motor Group signed a memorandum of understanding (MOU) yesterday with POSCO Group for comprehensive business cooperation in the fields of steel and secondary battery materials. POSCO formalized joint investment in an electric arc furnace steel plant being built by Hyundai Steel in Louisiana, USA. They also agreed to establish a supply chain for automotive steel plates and key battery materials such as lithium, anode, and cathode materials.
It is unusual that POSCO and Hyundai Steel, which have long maintained a competitive relationship as the top two players in the domestic steel industry, are joining forces as management risks, such as the U.S. tariff pressure and global environmental regulations, have intensified. The two companies are currently discussing specific investment conditions and methods.
Recently, Hyundai Motor Group's collaborative efforts are expanding beyond finished vehicles and batteries to encompass the entire manufacturing industry. This trend is attributed to the blurring of sector boundaries in future industries like eco-friendliness and artificial intelligence (AI) and the growing influence of Chinese corporations in the global market, supported by government assistance.
Earlier this year, Chung Eui-sun, chairman of Hyundai Motor Group, mentioned the importance of strategic collaboration, noting that the company could partner with competitors if necessary. In fact, Hyundai partnered with General Motors (GM) and Toyota, the largest competitors in the finished vehicle industry last year, in the area of future vehicles.
In February, Hyundai announced a plan to jointly develop robots (Samsung SDI) and smart factories (Samsung Electronics) with Samsung. In particular, the two companies plan to develop a high-performance battery exclusively for robots, and they have begun joint marketing at external exhibitions.
Hyundai is building joint plants in the United States with other battery companies, such as LG Energy Solution and SK On. The joint plant with SK On is aimed to commence operations in the second half of this year, while the joint plant with LG Energy Solution is scheduled to be completed next year. In Indonesia, a factory jointly invested with LG Energy Solution (HLI Green Power) started operations last year.
There are assessments that the strengthened relationships among the leaders of the top four conglomerates are leading to expanded alliances. Unlike during the tenure of previous chairmen, the future business has been restructured around advanced industries, leading to more opportunities for collaboration rather than competition. It is also reported that meetings and exchanges among the leaders have become more frequent, contrasting with the infrequent interactions of the past.