GM and Hyundai to collaborate in vehicle development and production

You can’t have enough leverage in today’s daunting automotive landscape. General Motors, already in a close tie-up with Japanese brand Honda, is adding Hyundai to its list of partners.

Both carmakers have signed a Memorandum of Understanding (MoU) to explore a range of potential joint ventures. These include vehicle development, production, and the exploration of new clean-energy technologies, including hydrogen powertrains.

The agreement, signed by GM CEO Mary Barra and Hyundai Motor Group Executive Chair Euisun Chung, marks a strategic effort by both automakers to achieve a grander scale.

General Motors has a long track record in allied projects (not all successful). Still, for Hyundai, the move is more unusual and an example of the mounting challenges posed by the powertrain transition and new user experiences.

Go-to-market more efficiently

The collaboration stretches beyond co-developing passenger cars and will include commercial vehicles, refining internal combustion engines, and advancing clean-energy technologies.

Additionally, GM and Hyundai will explore opportunities to combine the sourcing of critical materials such as battery components and steel to reduce costs and improve overall efficiency.

Barra emphasized the partnership’s potential benefits, noting that it could enable “disciplined capital allocation” and more efficiently bring a wider range of vehicles to market.

Chung echoed these sentiments, stating that the collaboration could enhance competitiveness in key markets and vehicle segments while delivering stronger customer value through shared expertise and innovation. Specific details remain undisclosed, and an MoU is subject to further exploration before it becomes a reality.

More size, enhanced competitiveness

GM and Hyundai’s combined scale—exceeding ten million vehicle sales annually—positions them to compete with industry giants like Toyota and Volkswagen. By working together, the companies aim to mitigate the cost burdens of developing those new technologies and navigate the evolving market landscape with more buffer.

GM has a longstanding partnership with Honda that spans over two decades. The partnership focuses on hydrogen fuel cells, electric vehicles, and autonomous driving technologies.

In the past, the General has also collaborated with Toyota to learn from Japanese manufacturing skills. This resulted in the joint Fremont factory, which landed—oh, the irony—in the lap of Elon Musk as his first Gigafactory and is now the brand to beat.

Few hopeful examples from the past

This partnership follows Hyundai’s participation in the Trilateral Executive Dialogue, a summit to foster cooperation among South Korean, US, and Japanese business leaders and policymakers.

These industrial partnerships are necessary to make the EV market affordable, reshape the organizational footprint, and drive innovation, especially in software and autonomous driving.

Though promising, the different underlying cultures can prove complex to assimilate. GM has witnessed this at several stages in its history. The group basically got ‘screwed’ by the old Agnelli over an opt-out in a famous share deal with Fiat, had to let go of its stake in Subaru in 2007, and had to pay for Stellantis to take over the Opel brand in Europe. The question remains if the different nature of the current challenges will set a more successful podium for cooperation.