Hyundai Motor Group is launching a fresh assault on the world's largest auto market, China, led by its electric vehicle brand Ioniq. The company plans to shed its image as a maker of value-for-money internal combustion engine (ICE) vehicles and transform into an eco-friendly car brand, aiming to quickly rebuild a market share that has fallen to below 1 percent.
Hyundai Motor (005380.KS) said Thursday it will unveil its transition plan toward new energy vehicles (NEVs), including EVs and hybrids, at the 2026 Beijing International Motor Show opening in the Chinese capital on Friday.
It marks Hyundai's first participation in a major Chinese motor show in two years. The Beijing and Shanghai motor shows are held in alternate years, and Hyundai did not attend last year's Shanghai event.
At the show, Hyundai will unveil a production model of the Ioniq tailored for China, fleshing out its eco-friendly vehicle strategy. The model is the first of six new EVs Hyundai has pledged to roll out in China by 2030. It will feature lithium iron phosphate (LFP) batteries from CATL, the world's largest battery maker, and autonomous driving technology developed by Chinese self-driving firm Momenta.
Hyundai will also formalize plans to launch an extended-range electric vehicle (EREV) next year, designed for China's long-distance driving demand. Separately, during its first-quarter earnings conference call Thursday, the company said it will introduce local-market versions of a compact sport utility vehicle (SUV), a mid-size sedan and a mid-size SUV. To support these launches, Hyundai is also in talks with local battery, energy and automotive players, including CATL, Sinopec and Yueda Group, on long-term cooperation.
The move represents a sweeping overhaul of the ICE-focused lineup Hyundai has maintained since first entering China in 2002. "We will shed our image as a maker of value-for-money internal combustion engine vehicles in the Chinese market and rebrand as an eco-friendly car company led by EVs," Hyundai said. "This will be the biggest change since Hyundai entered China."
The strategy is seen as Hyundai's renewed push to deepen localization and stage a comeback in China. The automaker suffered a sharp drop in sales in the wake of the Terminal High Altitude Area Defense (THAAD) missile dispute and subsequently fell behind in the shift to EVs, eroding its foothold in the country. The local market share of Beijing Hyundai, Hyundai's Chinese joint venture, slid from 1.2 percent in 2022 to 0.5 percent last year. Hyundai has set a target of selling 500,000 vehicles from its Chinese plants, including exports, by 2030.
Industry observers say Hyundai must quickly ride the electrification wave to stage a rebound in China. According to the China Passenger Car Association, domestic demand for ICE vehicles in China is forecast to fall nearly 20 percent this year to 9.05 million units, from 11.29 million last year. "Following the boycott of Korean products triggered by the THAAD dispute, Hyundai took a major hit as it failed to keep pace with the rapid technological advances in China's auto industry," an industry official said. "Chinese consumers are highly responsive to the latest EVs and autonomous driving technology, so Hyundai needs to move away from an ICE-centered portfolio."
A positive development for Hyundai is that the Chinese government is shifting its eco-friendly vehicle policy this year from quantitative expansion to qualitative growth. Beijing has operated a trade-in subsidy program, known as "yiguhuanxin," that offers incentives for swapping out old ICE vehicles for eco-friendly ones, and recently revamped the scheme from a fixed-amount to a percentage-based structure. Under the new structure, discounts shrink when consumers buy lower-priced entry-level cars, which is expected to weaken the position of local players that had expanded market share by selling cheap EVs. "Compared with the past, this is a favorable opportunity to compete with local players in a better environment," a Hyundai official said. "We will accelerate the shift to electrification in line with local trends."
