 |
Photo courtesy of Yonhap News |
[Alpha Biz= Kim Jisun] Hyundai Motor Company and U.S. automaker General Motors (GM) have agreed to jointly develop five vehicle models — including small passenger cars and SUVs — for launch in North and Latin America starting in 2028. The announcement has reignited speculation over a possible GM withdrawal from South Korea, as industry analysts warn the partnership could inevitably reduce the role of GM’s Korean operations (GM Korea).
Notably, GM pledged in 2018 to maintain vehicle production in South Korea for 10 years following a major restructuring. The scheduled launch year of the jointly developed small cars — 2028 — coincides precisely with the expiration of that commitment, prompting industry observers to suggest this is “unlikely a coincidence.”
According to the companies’ joint announcement on August 7, Hyundai will lead development of an electric van for North America and four models for Latin America, including a small passenger car, SUV, and pickup truck. GM will primarily handle development of a mid-size pickup truck for Latin America.
Historically, GM has assigned small car development and production to GM Korea, benefiting from relatively lower costs compared to the U.S. However, with this collaboration, GM will gain access to Hyundai’s small car technology, potentially diminishing GM Korea’s strategic role.
GM Korea is already facing competitive pressure as U.S. tariffs threaten its advantage as a small car production hub. If the Trump administration proceeds with imposing a 15% tariff on Korean-made vehicles, GM Korea would lose the duty-free benefit provided under the Korea-U.S. Free Trade Agreement (KORUS FTA).
The 2028 launch date also carries symbolic weight. In 2018, GM shuttered its Gunsan plant as part of a restructuring deal, securing KRW 810 billion in public funding from the Korean government in exchange for its pledge to maintain local production and keep factories operational for a decade. Industry insiders note that after 2028, GM would no longer be bound by that obligation.
Alphabiz Reporter Kim Jisun(stockmk2020@alphabiz.co.kr)
