Nam Hyun-woo has worked as a staff writer at The Korea Times since 2013, mostly covering business and politics. He currently belongs to the Business Desk where he covers topics such as emerging tech, AI, ICT and Korea's chaebol community. Prior to joining the team, he was the paper's correspondent for the presidential office of Korea during the Yoon Suk Yeol and Moon Jae-in administrations.
Hyundai Motor to invest $6.3 bil. for physical AI, robots in Saemangeum
President Lee Jae Myung shakes hands with Hyundai Motor Group Executive Chair Chung Euisun, third from left, during an MOU signing ceremony in Gunsan, North Jeolla Province, Friday. The group will invest 9 trillion won into the Saemangeum coastal area of the province. Also pictures are Deputy Prime Minister Bae Kyung-hoon, left, and Minister of Land, Infrastructure and Transport Kim Yun-duk. Yonhap
By Nam Hyun-woo
Investment marks milestone in carmaker’s transition to physical AI firm
Hyundai Motor Group will invest 9 trillion won ($6.26 billion) in the Saemangeum area of North Jeolla Province to set up an artificial intelligence (AI) data center for a physical AI, robot and component manufacturing cluster, water electrolysis plant, solar power facility and hydrogen model city.
Hyundai Motor Group announced this initiative on Friday during an MOU signing ceremony attended by President Lee Jae Myung, along with ministers and municipal leaders. Hyundai Motor Group Executive Chair Chung Euisun and other top executives of the group also joined the ceremony.
“The next-generation industrial paradigm that will take shape in Saemangeum will become a pivotal turning point for the future of not only North Jeolla Province but also Korea,” Hyundai Motor Group Vice Chair Chang Jae-hoon said while introducing the initiative. “Equipped with manufacturing expertise as well as capabilities in robotics, AI and hydrogen energy, Hyundai Motor Group is ready to build an advanced industrial ecosystem.”
Saemangeum is a massive reclaimed area in North Jeolla Province developed for multiple purposes, including industrial complexes, mixed-use development, tourism and agriculture. In recent months, local politicians have called for semiconductor companies to invest in its industrial zones, triggering debates over the feasibility of such investments.
With Hyundai Motor's decision to invest 9 trillion won in a robotics and AI project, the region has secured that long-sought advanced industry investment.
Lee stressed that the government will fully support the investment so that it can serve as a best-practice case for regional expansion.
“One of the top priorities of this government is balanced regional development,” Lee said. “I would like to thank Hyundai Motor Group for trusting the government and making bold decisions from a corporate perspective. … If the group’s innovation capabilities are combined with Saemangeum’s abundant resources, I believe the area can become a land of opportunity that delivers optimal synergy.”
According to the initiative, Hyundai will earmark 5.8 trillion won for building an AI data center for robots, autonomous driving and other elements for physical AI.
Hyundai Motor Group Vice Chair Chang Jae-hoon introduces the group's investment plan for Saemangeum during an MOU signing ceremony in Gunsan, North Jeolla Province, Friday. Yonhap
The center will be powered by 50,000 graphics processing units (GPUs) to process data required for vehicles, smart factories and other applications. The group said it will use its existing manufacturing data for AI training and establish a virtuous cycle in which the results are reapplied to its products.
Hyundai Motor will invest 400 billion won to set up a robot and robot component manufacturing cluster in the area.
It has yet to be decided which types of robots will be produced there, but the cluster will comprise a complete robot manufacturing plant, a foundry plant for contract robot production and a component cluster. The manufacturing facility is expected to adopt Hyundai Motor’s robot-based smart logistics systems and will also take on contract manufacturing for small and medium-sized enterprises.
The group also plans to invest 1 trillion won in a 200-megawatt water electrolysis plant to produce clean hydrogen, 1.3 trillion won in a gigawatt-scale solar power complex and 400 billion won to build an AI hydrogen city that integrates Hyundai Motor’s AI, robotics and hydrogen energy technologies into a comprehensive industrial ecosystem.
Construction of the AI data center, the solar power farm and the electrolysis plant will begin in 2027. The data center and solar power complex are scheduled for completion in 2029. The electrolysis plant will complete its first phase in 2029, with capacity to be expanded in stages thereafter. Construction of the robot manufacturing plant and parts cluster will begin in 2028 and is expected to be completed in 2029.
Hyundai Motor Group expects the initiative will create approximately 16 trillion won of economic value and create 71,000 jobs in total.
Hyundai Motor Group's MobED autonomous driving platforms are displayed at the company's booth for CES 2026 in Las Vegas, Jan. 7. Courtesy of Hyundai Motor Group
The investment marks a milestone for Hyundai Motor Group’s transition from carmaker to a physical AI company.
At CES 2026 last month, Hyundai Motor, with its robotics affiliate Boston Dynamics, demonstrated the industrial applicability of its Atlas humanoid robot and Hyundai Robotics LAB showcased other AI-powered robots, including MobED.
“Market perception of Hyundai Motor is shifting from a traditional value stock to a physical AI-driven growth stock,” KB Securities analyst Kang Seong-jin said. “This investment is significant in that it marks the beginning of concrete execution of its physical AI vision and is seen as a strategic move to preempt tariff risks.”
Robots developed by Boston Dynamics are not expected to be produced in Saemangeum. However, as Hyundai Robotics LAB is preparing a range of robots, including MobED, there is a possibility that some of those models could be manufactured there.
“With our world-leading manufacturing and innovation capabilities, we will contribute to helping Korea take the lead in future industries,” a Hyundai Motor Group official said.