Hyundai is set to become the latest automaker abandoning the development of future internal combustion engines as it rapidly migrates to battery-electric propulsion.
Reports from Korean media separately indicate the carmaker has put a pause on plans for a hydrogen fuel-cell vehicle for the Genesis brand.
In an e-mail to employees first reported by the Korea Economic Daily, Hyundai’s new R&D boss, Chung-Kook Park, outlined the automaker’s new direction, noting “it is inevitable to convert into electrification. Our own engine development is a great achievement, but we must change the system to create future innovation based on the great asset from the past.”
Jobs on the line
According to the business publication, 12,000 Hyundai employees currently work on internal combustion technology. Many will be transferred to EV powertrain programs, though it is unclear if there will be work for all of them.
Development of battery-drive technology is significantly different than what they traditionally worked on. Electric motors are relatively simple devices typically using single-speed gearboxes, rather than the complex multi-speed transmissions required in today’s gas-powered models. Much of EV development is focused on control-related software.
“This reorganization will be an important starting point for change ahead in the new year,” said Park, adding that “Researchers at the engine design unit have moved to the electrification design center, leaving only some to modify existing engines. The powertrain system development center is transforming into an electrification test center, while the powertrain performance development center is becoming an electrification performance development center.”
The coming transition
Early on, Hyundai relied on partners like Mitsubishi to provide it with powertrains. Its first in-house engine, dubbed Alpha, launched in 1991. It currently provides a broad array of conventional internal combustion engines, as well as hybrids and plug-in hybrids. But the Korean carmaker is staking its future on a shift to zero-emissions vehicles.
In December 2020, Hyundai rolled out its first all-electric platform, the E-GMP, which will underpin 23 battery-electric vehicles by 2025. These will be sold through all three of its automotive brands, starting with the new Hyundai Ioniq 5, the Kia EV6 and the Genesis GV60. (Several other BEVs, including the Hyundai Kona EV and Genesis Electrified G80, will use conventional platforms modified for battery power. But they are expected to be phased out as the E-GMP architecture takes over.)
In May of this year, the automaker announced it will invest $7.4 billion to produce electric vehicles in the U.S. The first products will start rolling off the line in 2022.
Hyundai is just the latest automaker to announce plans to phase out development of new internal combustion technology. Audi and Volkswagen are taking similar, near-term steps and General Motors is shifting R&D efforts, as well.
Fate of fuel-cell program also uncertain
The Korean automaker has, until now, outlined a zero-emissions strategy that blended both battery-electric and fuel-cell technologies. In fact, Hyundai had in the past described BEVs as a temporary solution until hydrogen drive “take(s) hold.”
But new reports raise questions about Hyundai’s long-term commitment to fuel-cell systems. Korean news publication Chosun Ilbo reports that the Genesis fuel-cell vehicle has been put on indefinite hold – and the reasons behind that move stoke concerns about Hyundai’s broader fuel-cell program.
The automaker current sells the Nexo hydrogen car using second-generation fuel-cell technology. The Genesis model was set to use a third-gen system but, after a year of development, reports Chosun Ilbo, none of the key targets are being met. Some of these are internal, notably efforts to improve efficiency and reduce production costs.
Nagging problems
But there are plenty of external challenges facing all the companies hoping to build a market for fuel-cell vehicles – including Toyota and Honda, as well as Hyundai. Sources of the lightweight gas are still rare, and the cost of the fuel remain stubbornly high, even though proponents had hoped it would become cheaper than gasoline on a gallon-equivalent basis.
Whether this is a sign of a broader shift in Hyundai strategy is unclear. The company a year ago created a new subsidiary, dubbed HTWO, specifically to work on applications for fuel-cell technology, including not only cars and trucks but boats, rail and aircraft.
TheDetroitBureau.com has reached out to Hyundai for comment on both moves in its powertrain plans. The automaker has not yet responded.