Lee Min-hyung joined The Korea Times in 2014 and has worked as a journalist mainly in Korea’s finance, tech and automotive industry. He specializes in content creation, breaking news and in-depth analysis currently on transportation and mobility. You can reach him via mhlee@koreatimes.co.kr.
Hyundai Motor set to deepen ties with CATL on sidelines of APEC
Hyundai Motor Group Executive Chair Chung Euisun applauds during the carmaker's New Year's event at Hyundai Motorstudio Goyang in Gyeonggi Province, Jan. 6. Newsis
By Lee Min-hyung
Hyundai Motor Group Executive Chair Chung Euisun is set to elevate the carmaker's battery alliance in a possible meeting with Zeng Yuqun, chairman of Chinese battery giant CATL, on the sidelines of the upcoming Asia-Pacific Economic Cooperation (APEC) meetings.
Both business leaders will participate in the four-day APEC CEO Summit, set to begin Tuesday in Gyeongju, North Gyeongsang Province. Details on the specific location and timeline for their symbolic meeting have not been confirmed.
The head of the world’s largest electric vehicle (EV) battery maker is widely expected to discuss the possibility of expanding its battery supply to more EV lineups of Hyundai Motor and Kia.
Hyundai Motor Group is also standing at a critical juncture where it has to achieve deeper inroads particularly into the lucrative European EV market.
CATL is already supplying lithium iron phosphate (LFP) batteries for Hyundai Motor’s Kona Electric, along with Kia’s Niro EV and Ray EV. The Chinese battery maker in July also began supplying nickel cobalt manganese (NCM) batteries to Kia’s EV5 electric SUV.
For Hyundai Motor Group, the battery partnership with CATL is inevitable due to the firm’s unmatched price competitiveness compared with Korea’s major battery firms. CATL battery prices are 10 percent lower than those of LG Energy Solution, Samsung SDI and SK On.
Zeng Yuqun, right, chairman of Chinese battery giant CATL, walks in a hotel in Beijing, China, April 29, 2024. Reuters-Yonhap
With Hyundai Motor Group on track to expand its EV sales lineup in Europe to offset tariff shocks from the United States, there stands a likelihood for the carmaker to sign additional contracts to receive battery supplies from CATL for the European market.
Hyundai Motor Group continues to face a 25 percent U.S. auto tariff and has seen a sharp drop in earnings in the second quarter of this year.
“The EV market in Europe is faced with toughening competition with the rapid rise of Chinese EVs, and Hyundai Motor Group has no choice but to enhance its price competitiveness by reducing prime costs for EVs so it can compete with its Chinese rivals there,” an official from the auto industry said.
“Europe is the carmaker’s second most important EV market along with the U.S., so the carmaker will go all-out to gain competitive edges in Europe by diversifying its battery supply sources."
CATL has also identified Korea as a major market for its global expansion. In January, the company established its first Korean office, in an apparent move to expand its battery supplies to automakers here and forge tighter ties with local battery and auto parts makers.