Hyundai Motor Group Collaborates with Korea Zinc to Strengthen Nickel Value Chain for Electric Vehicle Sector

Hyundai Motor Group has revealed its latest collaboration, marking a significant milestone in the electric vehicle (EV) sector. The Group recently entered into a Memorandum of Understanding (MOU) with Korea Zinc, a prominent non-ferrous metal smelting company in South Korea. This strategic partnership is poised to encompass a comprehensive collaboration that spans the entire nickel value chain.

This collaborative venture entails an array of joint efforts encompassing the sourcing and processing of nickel raw materials. A crucial aspect of the collaboration revolves around ensuring a consistent and secure supply of processed nickel and battery materials. Additionally, the partnership will extend its endeavors to explore novel business avenues, including battery recycling.

The driving force behind this partnership is the aspiration to establish a steadfast and reliable nickel supply chain, a critical component in the production of EV batteries. In tandem, both Hyundai Motor Group and Korea Zinc are committed to collectively procuring nickel raw materials. Furthermore, they are poised to invest in mine development initiatives aimed at securing raw materials that fulfill the stringent International Raw Material Assurance (IRA) criteria.

Hyundai Motor Group unveiled a strategic vision in April, outlining its ambitions to assert global leadership in the EV domain. The group is resolute in its objective to manufacture a staggering 3.64 million EVs, positioning itself within the top three global EV producers by 2030. An integral aspect of this vision revolves around the efficient procurement of pivotal raw materials, such as nickel and lithium. In pursuit of this, Hyundai Motor Group is actively seeking collaborations with international partners specializing in raw material procurement, processing, and battery material production.

Korea Zinc, known for its expertise in smelting non-ferrous metals like zinc and silver, embarked on a trajectory to bolster its presence in the EV battery industry. The company initiated this journey by establishing a subsidiary focused on nickel sulphate production for EV batteries back in 2017. Expanding its footprint in the EV battery realm, Korea Zinc is concentrating its efforts on nickel-related ventures. This expansion encompasses the establishment of a subsidiary dedicated to precursor production for EV batteries, coupled with plans to construct a nickel smelter in Ulsan's Industrial Complex this year.

Anticipated to commence in 2026, the nickel supply from this partnership holds immense significance. By 2031, Hyundai Motor Group envisions sourcing 50 percent of the nickel required for EV battery production, adhering to IRA prerequisites, from the collaboration with Korea Zinc. This supply is projected to play a pivotal role in not only ensuring a stable source of EV battery raw materials but also in meeting other global EV-related regulations, such as the European Union's Critical Raw Material Act (CRMA), and fulfilling broader Environmental, Social, and Governance (ESG) requirements.

As a further manifestation of this collaboration, HMG Global, an overseas joint venture established in conjunction with Hyundai Motor, Kia, and Hyundai Mobis, has outlined plans to acquire a 5 percent stake in Korea Zinc. This collaborative effort underscores Hyundai Motor Group's dedication to sustainable growth and innovation in the burgeoning EV landscape.