SEOUL, Jan. 16 (Korea Bizwire) — Hyundai Motor Co. and its affiliate Kia Motors Corp. said Thursday they have invested US$110 million in the U.K.-based electric vehicle startup Arrival as part of their future mobility strategy.
Hyundai and Kia have made the investment to jointly develop electric commercial vehicles, such as vans and buses, for the European market and sell them to local logistics and mobility companies that provide on-demand ride-hailing and shuttle services, Hyundai Motor Group said in a statement.
Hyundai and Kia injected $89 million and $22 million, respectively, in the British company, which has developed in-house software, components and other technologies for the development of a next-generation electric vehicles, it said.
They didn’t provide further details of the investment.
“The eco-friendly vehicle market in Europe is expected to grow rapidly due to the introduction of further environmental regulations,” Albert Biermann, president and head of the research and development division at Hyundai Motor Group, said in the statement.
Through the partnership with Arrival, Hyundai Motor Group will be able to gain a competitive edge and make its presence felt in the global eco-friendly vehicle market, with Europe at the forefront, he said.
Arrival’s Chief Executive Denis Sverdlov said, “Arrival has created a game changing product category — Generation 2 Electric Vehicles. This strategic partnership will empower our companies to scale Generation 2 Electric Vehicles globally.”
Hyundai and Kia will be able to use Arrival’s “skateboard” vehicle platform, which has a modular component structure that makes it a cost-effective base and incorporates a battery pack, an electric motor and driveline components, the statement said.
The two carmakers said they expect the investment in Arrival to help them to develop purpose built vehicles (PBVs) that allow passengers to enjoy tailored services while traveling to their destinations.
After personalization, PBVs can function as restaurants, coffee shops or hotels — even clinics and pharmacies — in addition to being urban shuttles.
With the rapid growth of online shopping, the volume of light commercial vehicles in urban areas has increased. Demand for eco-friendly commercial vehicles is expected to rise as governments tighten environmental regulations further, the statement said.
As for Hyundai, it expects the partnership with Arrival will help it accelerate its two-track strategy of delivering hydrogen fuel-cell electric and battery electric solutions for the European commercial vehicle market.
Last year, Hyundai and Kia made aggressive investments in overseas EV companies to carve out a presence in the rapidly expanding EV market.
In May, the carmakers invested $90 million in Croatian high-performance EV firm Rimac for joint research activities.
In September, they signed a deal to acquire a 20 percent stake in IONITY GmbH, a joint venture between BMW Group, Ford Motor Co., Daimler AG and Volkswagen Group established in 2017.
IONITY currently has nearly 140 charging stations in Europe, with 50 more under construction. Its fast chargers provide a maximum charging power of 350 kilowatts, seven times more powerful than normal rapid chargers on the market.
Hyundai said its strategic partnership with IONITY will help its European customers reduce EV charging times and better facilitate long-distance travel.