New Delhi

Hyundai Motor Company, one of the world's leading automobile manufacturers, has unveiled an ambitious strategy for the coming years, outlining its plans for growth and adaptation to evolving market trends. In a significant announcement made on Wednesday, the South Korean automaker revealed its intention to boost its global sales to 5.55 million vehicles annually by the year 2030. This target represents a substantial increase of 30 per cent compared to the company's sales figures from 2023.

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A key element of Hyundai's strategy to achieve this growth is a renewed focus on hybrid vehicles. The company plans to double its current hybrid lineup, expanding from seven models to fourteen. This move is seen as a response to a perceived slowdown in the global demand for fully electric vehicles (EVs). By broadening its hybrid offerings, Hyundai aims to cater to a growing segment of consumers who are seeking more fuel-efficient options but may not be ready to transition to fully electric cars.

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Hyundai's announcement, which was made during an investor day event, also included details of a generous shareholder return policy. The company intends to initiate a stock buyback program worth up to 4 trillion won (approximately USD 2.99 billion) between 2025 and 2027.

Hyundai plans to significantly increase its dividend payments. These financial measures were well-received by investors, resulting in a notable surge in the company's stock price, which closed 4.7 per cent higher on the day of the announcement.

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The automotive giant, which ranks as the world's third-largest automaker by sales when combined with its affiliate Kia Corporation, emphasized the growing importance of hybrid vehicles in the current market. Jaehoon Chang, President and CEO of Hyundai Motor, noted that the pace of conversion to electric vehicles has been decelerating recently. As a consequence, demand for hybrid vehicles is on the rise, with hybrids increasingly being viewed as a standard option rather than merely an alternative to traditional internal combustion engines.

In addition to its hybrid strategy, Hyundai also announced plans to introduce extended-range electric vehicle (EREV) models in the North American and Chinese markets. The company aims to commence mass production of these new EREVs in these regions by the end of 2026, further diversifying its eco-friendly vehicle portfolio.

Hyundai's strategic shift aligns with broader industry trends, as other major automakers like Ford Motor and General Motors have been reassessing their EV strategies in light of slower-than-anticipated consumer adoption. The move to emphasize hybrid vehicles mirrors similar approaches taken by competitors such as Toyota and Ford.

As part of its production plans, Hyundai revealed that its new factory in Georgia, United States, will manufacture both hybrid and electric vehicles. This decision reflects the company's commitment to maintaining a diverse product lineup that can cater to varying consumer preferences and market demands.

The company's financial performance has already shown signs of benefiting from its hybrid focus. Hyundai reported last month that the profitability of its hybrid models is comparable to that of its gasoline-powered vehicles, underscoring the growing importance of hybrids to the company's bottom line. This comes at a time when Hyundai's sales of pure electric vehicles experienced a significant decline, dropping by nearly 25% in the second quarter of this year compared to the same period in 2023.

In a move to enhance shareholder value, Hyundai announced its intention to increase quarterly dividend payments to 2,500 won per share from 2025 to 2027, representing a 25 per cent increase from previous levels.

Lastly, the company revealed plans to commercialise an autonomous driving vehicle foundry business. This venture aims to sell autonomous vehicles to various global software companies, potentially opening up new revenue streams and positioning Hyundai at the forefront of emerging automotive technologies.

Overall, Hyundai's comprehensive strategy demonstrates the company's adaptability in the face of changing market dynamics and its commitment to maintaining a strong position in the global automotive industry through a combination of product diversification, technological innovation, and shareholder-friendly policies.