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Hyundai makes massive $6.7B bet on hydrogen

The Korean carmaker plans to produce half a million fuel-cell cars and trucks a year by 2030.

2019 Hyundai Nexo
Hyundai is apparently confident the market for fuel-cell vehicles will grow rapidly.

Hyundai Motor Group is going all-in on hydrogen fuel cells, announcing on Tuesday a $6.7 billion investment that will see the company produce 700,000 fuel-cell systems annually by 2030. Of those, 500,000 a year will be destined for passenger and commercial vehicles under the Hyundai and Kia car brands.

Hyundai's "FCEV Vision 2030" plan includes the opening today of a new hydrogen fuel-cell plant in Chungju, South Korea. Operated by Hyundai Mobis, the facility will increase the division's annual fuel-cell production capacity from today's 3,000 units annually to 40,000 a year by 2022. All told, the hydrogen expansion is expected to create 51,000 jobs.

So far, hydrogen fuel-cell vehicles have struggled to gain major market penetration, in part because there aren't many fueling stations for them. But Hyundai says its data show that global demand for fuel-cell vehicles will grow to 2 million units annually by 2030. In addition to passenger cars and commercial vehicles, Hyundai also wants to explore supplying hydrogen systems for other vehicles, including industrial machines like forklifts and generators, as well as ships and even drones.

"We are confident that hydrogen power will transcend the transportation sector and become a leading global economic success," Euisun Chung, executive vice chairman of Hyundai Motor Group, said in a statement.

Hyundai currently sells the Nexo fuel-cell crossover, which in the US is rated to get up to 380 miles of range per tankful of hydrogen. A hydrogen-powered Kia model is expected by 2020, too. Hyundai has also announced that it will partner with Audi on the development of future hydrogen cars.