Hyundai's big moves into electrification start with big models

LOS ANGELES — Hyundai is moving rapidly to make itself a global player in green-car technology by rolling out hybrid and plug-in hybrid versions of its top-selling models over the next two years, along with mass-market electric vehicles, ending their niche status in the automaker's U.S. lineup.

Last week, to get the ball rolling, Hyundai revealed a redesigned Tucson with hybrid and plug-in options, hoping to better compete with rivals such as the Toyota RAV4 and Ford Escape that are being offered with both electrified powertrains in the popular compact crossover segment.

The South Korean automaker currently sells a small number of electrified vehicles, such as the Kona EV. But the Tucson product plan brings the future powertrain alternatives to its best-selling vehicle globally. The Santa Fe crossover and Elantra sedan will also offer their first hybrid options.

By the end of 2022, Hyundai will have three new hybrid vehicles, two plug-in crossovers, three battery EVs and the current Nexo fuel cell crossover, according to the automaker.

The green-car blitz is part of a bigger strategy to get ahead of the market as it moves to fully electrified vehicles, Jose Muñoz, CEO of Hyundai Motor America, said last week. Hyundai does not want to repeat its mistake from the past decade of moving too slowly to meet U.S. demand for crossovers.

"We recognize our company was not the fastest to bring SUVs to the market," Muñoz said during a webinar with the Automotive Press Association.

But the automaker's new directive, expressed by Hyundai Motor Group's recently named chairman, Euisun Chung: "We don't want to be fast followers. We want to be pioneers," Muñoz said.

"We see the future with plenty of green cars and electrified vehicles," he said. "If we want to be credible, and if we really want to be serious about this commitment, we need to develop our own battery EV brand."

Until now, Hyundai's green lineup was mostly focused on the niche Ioniq compact car in hybrid, plug-in and EV versions.

Starting next year, the Ioniq name will be used for a subbrand of battery-electric vehicles that Hyundai is rolling out in the U.S. It starts with the Ioniq 5 midsize crossover in 2021, followed by the Ioniq 6 sedan in 2022 and the Ioniq 7 large crossover by 2024, the company has said. All future Ioniqs will be full EVs.

Capturing a significant share of the green-car market means moving ahead now with transitional technologies such as hybrids and plug-ins, Muñoz said. But Hyundai has big plans for full EVs.

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By 2025, Hyundai Motor Group, which includes Kia and Genesis, is targeting annual EV sales of 1 million globally.

Hyundai's EV ambitions in the U.S. align with the expected pro-environmental policies of President-elect Joe Biden and even the new California policy of requiring all new cars sold in the state to be EVs by 2035.

"We hear loud and clear what the winning candidate, Biden, said on this," Muñoz said. "And we believe our company is extremely well prepared for that because, basically, he is advocating for green vehicles."

Muñoz added that Hyundai is also aligned with Biden on bringing jobs to the U.S. Hyundai will build the redesigned Tucson and the upcoming Santa Cruz pickup at its Alabama plant after a $410 million expansion. Further investments are possible.

"I think our programs are extremely aligned with future President Biden," Muñoz said. "At the same time, South Korea has been a long-term ally of the United States on all fronts. There is an extremely good relationship between both countries. There are strategic alliances, and we work together on many fields."

Muñoz also said Hyundai is comfortable that it can meet California's 2035 mandate that all new cars sold in the state be zero-emission vehicles.

"I think for us, it's very good. We are just launching more battery EV cars, we have a plan to more than double [the models] in three years, so we are set for success."

At the same time, he said, government policies need to be supported by the development of infrastructure for EV charging and fuel cell refueling. But Hyundai is not counting on subsidies in general to drive the EV market.

"We don't focus on EVs thinking of the regulations. We believe the market is the one that is dictating the rules, and we've seen it by the sales of other competitors," he said.

"The sooner we support the increase of battery EV technology in the country, the sooner our companies are going to be very competitive, the sooner the consumers are going to realize this is the right technology, and it's going to be win-win."