The prices of raw materials used to produce electric vehicle batteries are skyrocketing, but Hyundai Motor Group, unlike its competitors, is lacking a strategy against this trend, TheElec has learned.
The South Korean automaker, which runs Hyundai Motor and Kia, formed what it calls a strategic material team this year to react to the rising prices, sources said.
But the team has so far only been able to gauge the market condition, without coming up with a solution, they added.
The team has only been checking how the increase in raw material prices is affecting battery makers LG Energy Solution, SK On and Samsung SDI as well as CATL, they also said.
The automaker has a separate organization that oversees cobalt and other key materials. But this team only handles catalysts that are used to remove gas from engines such as platinum, rhodium and palladium. Hyundai Motor Group buys these materials directly from refineries.
However, for nickel, cobalt, lithium and manganese that are used directly in the production of batteries, it only recently formed the strategic material team
This contrasts with its competitors such as Volkswagen, Tesla, Mercedes-Benz, General Motors and Ford which had invested directly in mines. Volkswagen, for example, formed its battery material team in 2017 and bought nickels when they were cheap, the sources said. The company also uses financial methods such as hedging, they added.
Hyundai Motor needs to make efforts to buy eco-friendly battery materials to compete, they added, as organizations such as European Union are requiring car makers to show the carbon emission rate of their cars.