According to Korean website ET News, after two years of being out of the internal-combustion-engine development game, Hyundai has about-faced and created a new division to ramp up development of ICE engines.
Hyundai Motor Group has established a new Engine Design Department at its Electrification Performance Development Center. The department brings together 150 to 200 staff members who are focused on internal combustion engine R&D. It is also strengthening its team with additional employees from within Hyundai and external hires. Currently, the R&D headquarters is considering various strategies to comply with EU emission standards (Euro 7).
Hyundai Motor Group underwent a significant reorganization in late 2021, prioritizing electric vehicle technology by transforming its powertrain department into an electrification development department as well as establishing a battery development center. The shakeup, which included renaming entities from “Powertrain” to “Electrification,” was seen as a strategic move to fully embrace electric mobility. The change reflected the company’s decision to move away from internal combustion engines. The reorganization signaled a all-in commitment to electric vehicles, although market conditions have shifted considerably in the two years since.
Hyundai Motor Group initially planned to phase out internal combustion engines (ICE) in its EU-sold vehicles and replace them with hybrids and electric vehicles due to the ‘Euro 7’ standards, signaling an end to ICEs. However, after industry pushback on ‘Euro 7’ being unrealistic, the EU and Parliament opted to retain the ‘Euro 6D’ emission standards. Similarly, the U.S. EPA chose to ease certain requirements, with new emissions standards to be introduced gradually from 2027 to 2029, thereby extending the life of ICE vehicles.
The new engine design room is now focusing on developing engines that will comply with the anticipated ‘Euro 7’ standards. Despite a relaxation in emission regulations, they face challenges, including stricter testing conditions. With growing pressure to introduce hybrid models into the Genesis product line, there is an expectation for increased related research and development efforts.
Hyundai Motor Group hopes to enhance its profitability by prolonging the life of internal combustion engine vehicles. This approach may allow the company to cut development costs by refining current engines while saving on expensive battery materials. By balancing the production and sales mix of traditional vehicles and electric vehicles, Hyundai hopes to adapt to market demands.