South Korea: Hyundai and Kia to build hybrid sedans for government in 2007; mass production in 2009

Thursday, December 28, 2006,

Tags: Emissions, Engines, Hyundai Motor Company, OEM Strategy, Research & Development.

AutomotiveWorld.com

Hyundai and Kia Motors intend to begin production of a limited number of hybrid vehicles exclusively for the Korean government in early 2007, according to Korea Times.

The report states that Hyundai will produce a Verna (Accent) hybrid while Kia will make a gasoline-electric version of its Pride (Rio) sedan.

Sources say that the first phase of an existing programme will soon be completed as the government and Hyundai-Kia complete testing and research of gasoline-electric hybrid cars by the end of this month. R&D work on the hybrid programme began in 2004.

In the second phase, the government is expected to offer Hyundai and Kia more subsidies to develop and manufacture models on a small scale until 2008.

Both the government and the two OEMs plan to raise fuel efficiency of the two cars to 20km per litre from the current 18.5km per litre. Moreover, government backing is also expected to make the hybrid vehicles affordable.

The South Korean government plans to invest Won 38.9bn (US$41m) in the hybrid vehicles; about Won 14m (US$15,059) for each car. The government will purchase over 3,300 units in the next two years to pre-test the vehicles before they are marketed across the country.

Hyundai and Kia expect to begin mass production of the hybrid vehicles in 2009.

Earlier in December, the government announced plans to begin a pilot run of 14 hydrogen fuel cell-powered cars in 2007, ahead of a proposed commercial launch of such vehicles by 2015. The trial run is expected to cost the government and Hyundai-Kia Won 13.6bn (US$14.6m) each, in 2007 alone.

The manufacturers and the federal ministry each plan to spend Won 48bn (US$51m) to develop four fuel cell buses and 30 cars by 2008.

Published on Thursday, December 28, 2006