Hyundai: Coherent Mobility Strategy

Attendees at CES 2020 might have been stunned to see the S-A1 Urban Air Vehicle dominating the Hyundai booth in the North Hall - perhaps even raising questions as to how it got inside the building in the first place. It was a bold statement that presaged the announcement, weeks ago, that Hyundai Motor Group intends to invest $34.6B in mobility tech by 2025.

That $34.6B commitment is built upon three pillars including hydrogen, autonomous operation, and urban air mobility. Across all three pillars is an aggressive approach to innovation and experimentation and a willingness and ability to innovate and pivot. Another distinguishing characteristic is the attention paid to the customer experience as evidenced by the recent introduction by Hyundai's Motional joint venture with Aptiv of passenger partitions in self-driving car test vehicles in Las Vegas.

These elements are buttressed by the long- and short-term elements of Hyundai's strategy and what appears to be a more realistic approach to mobility by a car maker. The long-term plays include the urban air mobility initiative in partnership with Uber Elevate; in-house hydrogen-related developments including the Nexo fuel cell vehicle; and an autonomous vehicle collaboration with Aptiv.

The South Korean government is supportive of Hyundais' efforts, also investing in autonomous vehicles. Government representatives told Reuters they expect Hyundai to launch fully autonomous Level 4 vehicles for fleet customers in 2024 and for the general public by 2027. The government is also aiming “to lay the technological and legal groundwork for demonstrations of flying cars by 2025,” according to Reuters, which also quoted South Korea’s president as touting hydrogen as the future “bread and butter” of South Korea’s economy.

The bold $34.6B mobility investment announcement coincided with Hyundai’s $1.6B investment in Motional, the autonomous vehicle joint venture with Aptiv. The Motional joint venture includes a re-launch of existing autonomous vehicle testing in Las Vegas in partnership with Lyft along with activities in Pittsburgh and Boston.

The Motional investment is notable for its introduction of partitions in its self-driving testing vehicles in Las Vegas – which are operating on Lyft’s platform and include safety drivers – meaning both a Lyft driver and an observing safety driver for two front-seat operators. Based on consumer surveys, Motional executives see a 19% boost in interest in driverless cars in a post-COVID-19 world.

Hyundai’s investments in and commitment to emerging mobility operations include:

• An investment in Grab along with multiple electric vehicle pilot programs throughout Southeast Asia
• An investment in India’s Ola ride hailing service along with a number of related projects
• Launch of Ioniq Car Share in Amsterdam
• Launch of WiBLE car-sharing service in South Korea and Madrid, Spain
• Introduction of Delivery Car or Deal Car to support 200 car rental companies in South Korea with vehicle deliveries and pickups
• Introduction of Zero One True Innovation Accelerator Program with SK Telekom to nurture mobility and connected car startups
• Investment in Aurora self-driving car startup

In the U.S., Hyundai launched the WaiveCar car sharing program which has evolved into WaiveWork – a program for making cars available for $40/day for workers who require vehicles as part of their work but who do not own a vehicle of their own.

Hyundai is also operating the Mocean car sharing service in Los Angeles with a vision for ultimately having 300 shared electric vehicles available. Having launched on the eve of the COVID-19 outbreak, Hyundai has since pivoted slightly by using a couple of the existing Mocean vehicles to enable the delivery of health services for Los Angeles’ homeless population.

Hyundai’s mobility strategy is notable for its global scope, its long-term vision, its innovative and flexible approach and its attention to safety. None of the objectives – broader hydrogen adoption and deployment, autonomous vehicle development, urban air mobility – are simple.

The urban air mobility stands out, in particular, looking like a true moonshot. The reality is that 300 companies are working on air mobility solutions including every auto maker with the possible exception of Tesla Motors.

Hyundai is playing a long game but willing to pivot to tackle short-term opportunities. The company stands out in an automotive environment where car makers are often seen to be in retreat across the mobility marketplace – with General Motors shuttering Maven and BMW and Daimler weighing a sale of ShareNow. The company is also notable for partnerships with Uber, Lyft, Ola, and Grab. 

Perhaps the most notable innovation of all has been the installation of partitions in Lyft vehicles that are part of the Motional joint venture with Aptiv. This attention to detail in relation to passenger safety in the spirit of instilling confidence is an impressive gesture that speaks volumes. Hyundai is matching its big talk and big plans with a consumer-centric vision of mobility service delivery that will be central to any future success.