South Korea’s leading automakers are doubling down on their efforts to cut EV costs with new battery tech. Hyundai and Kia are teaming up to develop LFP battery materials to power up lower-priced EVs.
Hyundai and Kia eye cheaper EVs with LFP battery tech
Hyundai and Kia launched a new project to develop lithium iron phosphate battery cathode material for future EV models.
As part of the initiative, the automakers are teaming up with Hyundai Steel and EcoPro BM, South Korea’s leading battery materials maker, to develop a precursor for LFP battery cathode material production.
Korea’s Ministry of Trade, Industry, and Energy will also support the four-year project as part of its LFP Battery Technology Development plan.
“To meet future demand in the EV market, rapid technological development and effective battery supply chain establishment are essential,” Hyundai and Kia’s electrification and driving materials boss, SoonJoon Jung, said.
The new project is designed to “reduce import reliance” while securing Hyundai a stable supply chain as the industry shifts to electric.
Although most LFP battery cathode materials are made by adding lithium to precursor materials such as phosphate and iron sulfate, Hyundai and Kia are developing a more advanced process.
Using a direct synthesis process, adding iron powder and lithium simultaneously skips the need to create a separate precursor. According to Hyundai, this reduces hazardous substance emissions and cuts production costs.
More affordable EVs are coming
Hyundai claims its new method can boost production efficiency while driving lower costs compared to current processes.
With Hyundai Steel, the automakers plan to develop “high-purity iron powder” processing tech using domestically recycled iron. EcoPro BM will then use the tech to develop LFP battery cathode material.
By advancing new LFP battery tech, Hyundai and Kia want to “spearhead” advancements in the EV battery market.
The announcement comes as China continues dominating the global EV battery market. According to SNE Research, China’s CATL accounted for 31.6% of global EV battery sales in the second quarter. With BYD’s 11.9% share, China’s leading battery makers accounted for 43.5% of the worldwide market in Q2.
South Korea’s LG Energy Solution (14.7%), Samsung SDI (7.1%), and SK On (4.3%) made the top five in global EV sales.
China is leading the low-cost EV movement with vehicles like BYD’s Seagull selling for under $10,000 (69,800 yuan), but South Korea is not far behind.
Hyundai and Kia launched some of their most affordable EVs this year, including the Kia EV3 and Hyundai Casper Electric (Inster EV overseas).
The Casper Electric starts at just $22,800 (31.5 million won) in Korea. With incentives, Hyundai said the Casper EV could be bought for as little as $14,500 (20 million won), while Kia’s EV3 costs $30,700 (KRW 42.08 million).
In Europe, Hyundai’s Casper (Inster) EV will start at less than $27,000 (25,000 euros) with up to 220 miles (355 km) WLTP range. Kia’s EV3 starts at around $42,000 ((£32,995) with up to 372 miles (599 km) WLTP range.
Electrek’s Take
Hyundai and Kia are already climbing the global EV sales ranks. In the second quarter, the Korean automakers topped Ford and GM in US EV sales, claiming over 10% of the market.
Korean automakers already have some of the lowest-priced electric vehicles in the US, with the Hyundai Kona Electric starting at under $35,000 and Kia’s EV6 starting at $42,600. However, Hyundai and Kia are planning to launch even more affordable EVs.
Kia’s EV3 is expected to start at around $35,000 in the US, while its EV4 electric sedan, set to launch next year, will be priced at around $39,000.
Hyundai is opening its massive Metaplant America in Georgia this fall, enabling US-built electric models.
The first EV set to roll off the assembly line is Hyundai’s updated 2025 IONIQ 5. Once battery production begins in GA in 2025, Hyundai expects vehicles built at the plant will qualify for the $7,500 EV tax credit. Until then, the company is passing on massive discounts through leasing.
With advanced new battery tech, Hyundai and Kia expect to continue lowering EV production costs, enabling more affordable models.
Source: Hyundai Motor Group
FTC: We use income earning auto affiliate links. More.
