Hyundai Motor Group has entered into a strategic partnership with Korea Zinc, a prominent ferrous metals smelting firm, with the objective of establishing a stable supply chain for nickel — a crucial raw material in the production of electric vehicle (EV) batteries.
Under this collaboration, Hyundai and Korea Zinc will jointly source and process nickel raw materials, and they will also explore new business opportunities, including battery recycling initiatives. Additionally, the two partners plan to jointly purchase nickel raw materials and invest in mine development projects to acquire raw materials compliant with the US Inflation Reduction Act (IRA) requirements.
In April, Hyundai unveiled its ambitious plan to assert global leadership in the EV market by manufacturing 3.64 million EVs and positioning itself among the top three global EV manufacturers by 2030. To support this goal, the Hyundai Group is prioritizing the procurement of key raw materials, such as nickel and lithium, and actively seeking collaborations with global partners specializing in raw material procurement, processing, and battery material manufacturing.
Leveraging its expertise in smelting non-ferrous metals like zinc and silver, Korea Zinc established a subsidiary dedicated to nickel sulfate production for EV batteries in 2017. The company is committed to expanding its presence in the EV battery sector, particularly in nickel-related activities, including the establishment of a nickel smelter in the Industrial Complex in Ulsan this year.
The partnership aims to commence nickel supply in 2026 and, by 2031, intends to source 50% of the nickel required for EV battery production, meeting the IRA requirements, from the collaboration with Korea Zinc. This secure supply of nickel is expected to assist Hyundai in meeting not only regional EV-related regulations but also global standards such as the European Union’s Critical Raw Material Act, as well as various environmental, social, and governance requirements.
As part of this collaborative effort, HMG Global, an overseas joint venture established by Hyundai Motor, Kia, and Hyundai Mobis, plans to acquire a 5% stake in Korea Zinc at a share price of approximately KRW 504.333 per share, with a total transaction value of about KRW 527.2 billion. Hyundai will also have the right to nominate one non-executive director as part of this acquisition, further strengthening the strategic ties between the two entities and enhancing cooperation across the entire EV business value chain.
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