Automotive News Europe — 2025-08-07
Automotive Industry
General Motors and Hyundai Motor plan to develop five vehicles together including an electric van as they seek to lower costs amid growing competition from nimble Chinese rivals.
The automakers will develop four vehicles for central and South American markets, including a compact SUV, a sedan and two pickups, all with the flexibility to use either an internal combustion engine or a hybrid system, the companies said in a statement Aug. 7.
Design and engineering work is underway on the new vehicles for the central and South American markets, which will launch in 2028, the companies said. The electric commercial van will be manufactured in the U.S. as early as 2028, they said.
GM will steer the development of the midsize truck platform, while Hyundai will lead the compact vehicle and electric van.
The automakers did not say where the models would be produced, but said they expected to be rolling out at least 800,000 vehicles a year at full production.
The partnership is Hyundai’s first with another automaker for a large-scale project, paving the way for both sides to pool resources for more efficient capital spending and manufacturing operations in markets around the world.
GM has been unwinding several projects with Japan’s Honda over the past decade. In 2023, the two companies scrapped a $5 billion plan to jointly develop affordable electric vehicles.
Hyundai has been seeking to diversify its product lineup and boost profitability to cushion the impact from U.S. tariffs and slowing global demand. Hyundai and its affiliate Kia face a 15 percent levy under President Donald Trump’s tariff regime — which could amount to as much as $5 billion in additional costs this year, according to Bloomberg Intelligence.
Tie-up marks GM push into global markets
For GM, the new vehicles will mark a renewed push for growth in global markets after years of shrinking its international business. Under CEO Mary Barra, GM has closed operations in Australia, Europe, India, and Southeast Asia, while also restructuring its struggling China business.
With Hyundai’s help, GM hopes to have smaller vehicles designed for consumers who don’t drive the large trucks that are popular in the U.S.
The partnership will help GM and Hyundai battle growing competition from Chinese EV manufacturers in Latin America. But some questioned whether it would create meaningful synergies.
“Even if they sell those new models in South America, it’s hard to beat Chinese competitors which already are leading in the electric-vehicle market with low prices,” said An Hyung-jin, chief investment officer at Seoul-based hedge fund Billionfold Asset Management.
“Hyundai might be able to learn from GM about how to build pickup trucks, but it would take some time to generate earnings,” he added.
Global automakers face stiff competition from Chinese EV makers and a trade war impacting imports of crucial parts, including rare earth materials, which has pushed production costs higher.
Chinese automakers have put out several high-tech, low-cost models, affecting demand for EVs from legacy automakers including GM.
Hyundai would get boost in lucrative U.S. van market
Hyundai’s presence in China — the world’s largest auto market — is minimal but it faces growing pressure from Chinese auto exports globally.
The Korean automaker is leaning on its U.S. sales while its China sales decline. Unlike GM, Hyundai has little presence in the lucrative U.S. commercial vehicle and truck market.
Collaborating with Hyundai on vans could help GM reduce development costs on those models, especially considering its decades-old Chevrolet Express and GMC Savana vehicles.
In March, Hyundai unveiled a plan to invest a record $21 billion in the U.S. through 2028, aiming to ramp up production and generate about 14,000 direct jobs. The project includes $9 billion to boost factory output to about 1.2 million vehicles annually.