Hyundai to invest over $85bn in advanced manufacturing in South Korea by 2030

The investment between now and 2030 represents an increase of ₩36.1 trillion ($24.7 billion) on that invested in the previous five-year period. Hyundai hopes the investment will strengthen South Korea’s position as a global mobility hub and further energise its national economy.

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The total sum of the investment will be distributed across three major areas: ₩50.5 trillion ($34.6 billion) will be spent on future business investment across AI, software defined vehicles (SDVs), electrification, robotics and hydrogen; ₩38.5 trillion ($26.4 billion) will go towards research and development to develop new products and core technologies; and the remaining ₩36.2 trillion ($24.8 billion) will be capital investment to optimise production facilities and construct the group’s Global Business Center (GBC) in Seoul.

Hyundai has highlighted that a significant portion of the investment will focus on new businesses based on advanced AI technologies, such as robotics, which it said will contribute to the development of South Korea’s AI and robotics innovation ecosystem.

Amongst the technologies Hyundai plans to invest in are AI-powered autonomous driving, smart factories and robotics. This comes after Hyundai announced at the end of October that it will collaborate with chipmaker Nvidia to build an AI factory powered by NVIDIA Blackwell AI infrastructure. As part of this, the two companies are aiming to enable integrated AI model training, validation and deployment using 50,000 NVIDIA Blackwell GPUs.

This is not the only facility Hyundai plans to build to support its ambitions. The group is also reviewing the possibility of establishing of a high-powered AI data centre process the significant amount of data required for AI model training and operations.

Furthermore, it is pushing forward the establishment of its Physical AI Application Center, which it has said will play a central role in advancing the physical AI ecosystem, and will build a robotics manufacturing and foundry facility, which it hopes will enable it to produce complete robotics systems in-house and offer foundry services for SMEs lacking manufacturing expertise.

South Korea’s technology prosperity deal with the US

In late October – during US president Donald Trump’s state visit to Gyeongju, South Korea – the governments of the US and South Korea signed a memorandum of understanding (MoU) confirming the intention for the two countries to collaborate closer in a number of disciplines, including accelerating AI adoption and innovation.

According to the White House, the agreement will see both nations working together to “drive innovative research and development to accelerate the application of AI” for the advanced manufacturing sector, amongst others. The two countries have also agreed to engage in discussions to “promote education, innovation, and technology for children to flourish in the digital era and prepare future generations for the workplace of tomorrow”.

Other aspects of the MoU include recognising the importance of research security, partnering more in telecommunications innovation and supply chain resilience, and securing pharmaceutical and biotechnology supply chains.

In addition, the White House confirmed that the US would reduce its Section 232 sectoral tariffs on automobiles and auto parts from 25% to 15%. It also said – in terms of tariffs on semiconductor manufacturing equipment – it intends to provide terms that are “no less favourable than terms that may be offered in a future agreement covering a volume of semiconductor trade at least as large as Korea’s, as determined by the United States”.

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Hyundai’s big plans for EV exports from South Korea

The group plans to “diversify export destinations for vehicles produced at domestic plants and significantly expand exports by developing Korea’s EV-dedicated facilities into global export bases”.

It is aiming to export 2.47 million units annually by 2030, having exported a total of 2.18 million units in 2024. In particular, it is looking to increase its export of EVs, PHEVs, HEVs and FCEVs from 690,000 units each year (as of 2024) to 1.76 million units over the same period.