Hyundai Motor recently launched a dedicated organization to collaborate with U.S. General Motors (GM). Hyundai Motor recently announced it would join hands with GM to build vehicles for sale in South America, and the newly created organization will take the lead in development and production and secure profits.
According to a Hyundai Motor Group official on the 1st, Hyundai Motor on the 26th last month created a new division for collaboration with GM, the Project Forest SA (South America) business unit.
The head of the Project Forest SA business unit is Vice President Philippe Guerambout, who also serves as head of Hyundai Motor's Global Product Operations Division and the next-generation electric vehicle (EV) project. Executive Director Ju Seok-ha, who worked as head of MSV Project 3 under the research and development (R&D) Division, moved to serve as director overseeing operations.
The business unit consists of a product development section, a product planning section, a finance section, and a Project Management Office (PMO) section, and executives from the Finance Division and the Global Product Operations Division will join in dual roles.
A Hyundai Motor Group official said, "The Project Forest SA business unit is an organization to lead all activities, including joint product development and production with GM in Central and South America," and added, "It will set and execute strategies to secure profits during the collaboration process."
Earlier in Aug., Hyundai Motor announced it would jointly develop five vehicles with GM. The two companies agreed to build together a midsize pickup truck, a small pickup truck, a small passenger car, and a small sports utility vehicle (SUV) for sale in South America, as well as an electric commercial van for the North American market. All models will be developed as internal combustion engine vehicles and hybrids and are scheduled to launch starting in 2028.
The decision by the two companies to join forces reflects expectations that each has different strengths by vehicle type and that they can secure the capability to jointly respond to various investment risks. Many assess that GM has an edge in pickup trucks, while Hyundai Motor is competitive in small passenger cars and SUVs, and that collaboration will yield strong synergies.
Inside Hyundai Motor Group, there were also "cautious" views about collaboration with GM. Hyundai Motor has grown through vertical integration and tends to be highly closed, and during collaboration with an overseas finished-vehicle group, differences could continually arise over profit distribution, product development, and production.
Hyundai Motor entered China in 2002 and, in a joint venture with Beijing Automotive (BAIC), established Beijing Hyundai. Through Beijing Hyundai, Hyundai Motor was able to earn significant revenue in China, but it has also been criticized for resulting in strengthened technological and production competitiveness of Chinese automakers, including BAIC. Beijing Hyundai's presence has now shrunk considerably.
An official in the finished-vehicle industry said, "From GM's perspective, it is likely very interested in Hyundai Motor's know-how in small-car development and hybrid technology," adding, "If the approach is not made with a meticulous strategy from the outset, the results could be more harmful than beneficial."