Hyundai Motor Group will buy a 5% stake in Korea Zinc Co., the world’s largest smelter for non-ferrous metals, as part of its effort to ensure access to key metals used in making electric-car batteries.
The group, which controls Hyundai, Kia and Genesis brands, signed a partnership Wednesday with the smelter to jointly develop a “nickel value chain” that procures, processes and recycles the metal needed for EV batteries, the Seoul-based automaker said in an emailed statement. Hyundai will spend 527.2 billion won ($398 million) to purchase shares of Korea Zinc as part of the tie-up, it said.
Hyundai plans to buy 50% of nickel it needs for EV batteries through the partnership by 2031 to comply with President Joe Biden’s Inflation Reduction Act, which encourages carmakers to produce EV components outside of China. The supply chain built with Korea Zinc, also based in Seoul, will meet European requirements for the sourcing of critical minerals and satisfy other ESG rules, the automaker said.
It aims to be one of the world’s top three EV makers by the end of this decade by producing 3.64 million vehicles annually.
The company has denied speculation that it wants to build its own lithium-ion batteries for EVs, though it has acknowledged that it’s studying solid-state batteries. Hyundai opened a research center in July in collaboration with Seoul National University to develop next-generation batteries.
–With assistance from Shinhye Kang.
© 2023 Bloomberg L.P.