Hyundai Motor to build first overseas hydrogen fuel cell plant in China

Hyundai Motor Co. will build its first overseas hydrogen fuel cell systems plant in China as the South Korean company aims to enter the world’s largest auto market with its hydrogen vehicles built there.

Hyundai plans to build the factory in Guangzhou by the end of this year and begin the production of hydrogen fuel cells from 2022, according to government and industry officials on Jan. 5.

Officials said Hyundai will likely supply fuel cells produced at the Guangzhou plant to its commercial vehicle factory in Sichuan to locally manufacture hydrogen-powered vehicles.

The plan comes after the automaker recently obtained approval from the Ministry of Trade, Industry and Energy for the export of its technology related to hydrogen fuel cells. A cross-border transfer of such technology requires government approval due to concerns over possible leaks of advanced technology.

The ministry believes the plant will pave the way for Korean auto parts suppliers to increase their exports to China, according to industry officials.

The move comes as part of the Korean automotive group’s five-year plan, “Strategy 2025,” under which it aims to transform the company into one of the world’s leading providers of future mobility and manufacturers of electric cars and hydrogen fuel cell-powered vehicles.

Under the plan announced in December, Hyundai said it is launching a new brand dedicated to its hydrogen fuel cell systems. The brand, HTWO, stands for the hydrogen molecule, H2, as well as “hydrogen and humanity,” it said.

NEW SUPPLY CHAIN

The shift away from internal combustion engines to batteries and hydrogen power is forcing global automakers to set up new supply chains.

In China, Hyundai Motor will be competing with global peers such as Japan’s Toyota Motor Corp. as well as Chinese automakers.

Toyota is already in the Chinese hydrogen-powered auto market by establishing hydrogen-charging facilities in Jiangsu in 2017 and launching a joint R&D firm with a Guangzhou-based Chinese company last year.

In November 2020, Hyundai Motor said it signed two initial agreements with several Chinese companies toward establishing business platforms for hydrogen trucks in China. Hyundai said that the deals will pave the way for the company’s project to sell as many as 27,000 hydrogen-fueled commercial vehicles by 2030 in China, which aims to have one million hydrogen vehicles on its roads by that time.

HYUNDAI'S FUEL CELL SYSTEM, PROVEN TECHNOLOGY

Hyundai’s fuel cell system has already been applied to the Hyundai NEXO, the world’s first hydrogen-powered SUV that has the longest driving range of hydrogen vehicles in the market, hydrogen truck XCIENT and fuel cell bus Elec City.

Hyundai said in November that it is teaming up with London-based chemicals company INEOS to explore new business opportunities in the global hydrogen economy.

The company began mass production of hydrogen fuel cell trucks in July 2020 and started to export them to Europe.

In 2018, Hyundai unveiled its mid- to long-term fuel cell roadmap, under which the automaker aims to increase annual production of hydrogen fuel cell systems to 700,000 units by 2030.

Hyundai Motor Chairman Chung Euisun, who took the helm of the automotive group in October last year, has said the company will push for new growth businesses focusing on EVs, hydrogen fuel cell cars and future mobility platforms.

Write to Byung-Uk Do at dodo@hankyung.com
In-Soo Nam edited this article.