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Hyundai Motor Aims To Develop Its Own Chips

Hyundai temporarily suspended work in some factories, but now wants to develop its own chips to reduce reliance on chipmakers to prevent supply problems in the future.

A Hyundai Motor booth is seen in Pyeongchang, South Korea in Feb 2018. File photo: Kim Hong-Ji, Reuters.

 

Hyundai Motor’s global operating officer said on Wednesday the automaker wants to develop its own chips to reduce reliance on chipmakers.

A global shortage of semiconductors, triggered partly by surging demand for laptops and other electronic products during the pandemic, has shuttered some auto production lines globally this year.

Hyundai temporarily suspended some factories, but the company’s global chief operating officer Jose Munoz told reporters the worst has passed for the industry chip shortage, adding it had the “toughest months” in August and September.

“The (chip) industry is reacting very, very fast,” he said, saying Intel is investing a lot of money to expand capacity.

“But also in our case, we want to be able to develop our own chips within the group, so we are a little bit less dependent in a potential situation like this,” he said.

“This takes a lot of investment and time, but this is something we’re working on.”

 

In-house development

He said the company’s parts affiliate Hyundai Mobis would play a key role in the in-house development plan.

He also said Hyundai Motor aims to deliver vehicles at the level of its original business plan in the fourth quarter, and offset some of its production losses next year.

Along with Toyota and Tesla, Hyundai is among a handful of automakers which increased global sales despite the chip shortage.

Hyundai decided not to cut orders during the pandemic, after seeing the Asian markets recover more strongly than expected, Munoz said.

 

EVs in the US next year

Munoz, president of Hyundai Motor North America, said the company is on track to produce electric cars in the United States in 2022, and is looking into both enhancing its existing factory in Alabama and increasing its production capacity.

He said the US government needs to extend a proposed $4,500 tax credit incentive to US electric vehicles made at non-union factories as well as union ones.

“American workers are the same,” he said. “We would like this to be equal for all.”

US factories of Tesla and foreign automakers such as Hyundai and Toyota Motor are not unionized.

 

• Reuters with additional editing by Jim Pollard

 

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Jim Pollard

Jim Pollard is an Australian journalist based in Thailand since 1999. He worked for News Ltd papers in Sydney, Perth, London and Melbourne before travelling through SE Asia in the late 90s. He was a senior editor at The Nation for 17+ years and has a family in Bangkok.

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