Hyundai Motor Company has taken a significant step in diversifying its artificial intelligence (AI) business by establishing a wholly-owned subsidiary in Shanghai, China. This move aims to secure competitive advantages and explore new demand by leveraging autonomous driving as a key future growth driver. Notably, the initiative is spearheaded by Hyundai’s Future Strategy Office, which serves as the control tower for the group’s future business ventures, indicating a strengthened collaboration with local R&D infrastructure.
According to Qichacha, a Chinese corporate information platform, Hyundai recently founded “Hyundai Modern Kemo Technology Co., Ltd.” in China, with an initial capital investment of approximately $30 million. The new subsidiary will focus on developing various AI-driven services, including AI and Internet of Things (IoT) solutions, AI-based software, and integrated systems for AI applications.
Autonomous driving technology is rapidly transforming the automotive industry, and its significance is increasing, particularly in the U.S. market. American companies such as Tesla are leading the way in autonomous driving technology, prompting Hyundai to strategically respond to this competitive landscape. The South Korean automaker is now intensifying its efforts to enhance its competitiveness in the autonomous driving and software-defined vehicle (SDV) markets.
In addition to launching a new electric SUV model specifically for the Chinese market later this year, Hyundai is expected to strengthen collaborations with local partners. The model, codenamed “OE,” is being designed at the Yantai Technology Research Center. Given that Hyundai’s brand recognition is notably lower compared to local competitors, the company has classified expanding its brand influence as a top priority and is simultaneously working on strategies to enhance its local presence.
The establishment of “Hyundai Modern Kemo Technology” is reportedly led by the Future Strategy Office, which was recently reorganized under Executive Vice President Jang Jae-hoon. This office focuses on identifying and nurturing future business opportunities for the Hyundai Group, working to transform the company from a traditional manufacturer into a software powerhouse by developing new growth engines such as autonomous driving and robotics.
Under the leadership of the Future Strategy Office, collaboration with Hyundai’s Advanced Technology R&D (Shanghai) Co., Ltd., which is also a wholly-owned subsidiary, is expected to be reinforced.
Hyundai has set an ambitious sales target of 500,000 units in China this year (400,000 for domestic sales and 100,000 for exports). The company is accelerating the launch of new electric vehicle models tailored to local consumer preferences and is speeding up the transition of its production plants into global export hubs. Last year, Hyundai sold a total of 154,200 vehicles in the Chinese market, down from 257,000 units the previous year, marking its lowest annual sales performance to date.
Hyundai’s strategy to enhance its autonomous driving capabilities and diversify its AI business is expected to capture significant attention in the U.S. market as it seeks to bolster its competitiveness on a global scale.
