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Hyundai Mobis to invest $257 mn in EV parts plants in Slovakia

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Hyundai Mobis CEO Lee Gyusuk (left) and Slovak Prime Minister Robert Fico attended the signing ceremony for investments in EV parts factories on Oct. 15, 2024, at the Slovak Government Office (Courtesy of Hyundai Mobis)

Hyundai Mobis Co., the world’s fifth-largest auto parts maker, agreed to invest some 350 billion won ($256.9 million) in building electric vehicle component factories in Slovakia to further expand its presence in Europe, the global No. 2 EV market, with expectations of an eventual recovery in the eco-friendly car industry.

Hyundai Mobis said the company signed a memorandum of understanding with the Slovak government on Tuesday to establish a facility for power electric (PE) systems – engines of EV – in Novaky in western Slovakia. The company also plans to set up a separate plant for EV braking systems and airbags at its existing auto parts production complex in Žilina in the country’s north-western region.

The unit of the leading South Korean automaker Hyundai Motor Group is set to spend 250 billion won on its first PE system factory in Europe, which will be completed in the second half of 2025 to manufacture 300,000 units a year. It set aside about 95 billion won for the braking system and airbag facility.

“We will expand electrification business opportunities in Central Europe based on the new PE system plant in Novaky under the support of the Slovak government,” said Hyundai Mobis CEO Lee Gyusuk at the signing ceremony for the project.

Slovak Prime Minister Robert Fico said the government is poised to provide some 26 million euro ($28 million) in incentives to Hyundai Mobis for the Novak factory as the project should contribute to the post-coal transformation of the region, according to foreign media.

A rendering of Hyundai Mobis’ new electrification plant in Slovakia (Courtesy of Hyundai Mobis)

TARGETS ELECTRIFICATION SECTOR IN EUROPE

Hyundai Mobis, which focuses on electrification to improve its competitiveness in future mobility, aims to use the facilities in Slovakia where many global automakers have plants for the European market.

Volkswagen AG, Stellantis N.V. and Jaguar Land Rover Automotive PLC, as well as Kia Corp. of Hyundai Motor Group, operate production facilities in the country, while Volvo is building an EV plant there.

Hyundai Mobis is already manufacturing battery system assemblies (BSAs) in the Czech Republic and building a BSA plant for Volkswagen in Spain.

The South Korean company is expanding its electrification bases in strategically important markets at home and abroad as it expects the global EV industry to recover from the protracted slowdown amid sluggish demand eventually.

Hyundai Mobis is scheduled to open BSA and PE system facilities in Alabama later this year after starting commercial operations of a BSA factory in Indonesia last July.

By Jung-Eun Shin

newyearis@hankyung.com

 
Jongwoo Cheon edited this article.

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