HKAG to Focus on Eco-friendly Cars & Creating Jobs in 2009

- HKAG to secure future competitiveness by investing in eco-friendly cars & an integrated steel mill
- Group to cut executives’ pay, hire more interns to create & share jobs

(Seoul, Korea) Hyundai-Kia Automotive Group (HKAG), which includes Hyundai Motor Co. and Kia Motors Corp., announced that it would overcome current economic difficulties by maintaining last year’s investment levels, to secure competitiveness and create jobs. In particular, the group will focus on the development of eco-friendly cars and completing the construction of an integrated steel mill.

HKAG forecasts that demand for fuel-efficient and eco-friendly cars will rapidly rise when the global economy recovers, and therefore plans to strengthen its investment in these areas, including training and nurturing talent. In order to achieve these goals, HKAG will invest a total of about 9 trillion won this year, similar to last year’s levels. Of this figure, 6 trillion won will be invested in facilities, including a 2 trillion won investment into an integrated steel mill being built by Hyundai Steel Co. The other 3 trillion won (of the 9 trillion won) will be invested in R&D.

Separately, HKAG will invest 2.4 trillion won into the development of eco-friendly cars in phases and expand the R&D workforce to as many as 1,000 in the future, to propel South Korea into the world’s top four `green car’ producing nations

As part of this strategy, the group will launch its first small hybrid car this year, starting with Hyundai Motor’s Elantra LPI Hybrid in July. HKAG will expand this line-up to include mid-sized sedans and plans to produce 30,000 hybrid vehicles by 2010. HKAG also plans to commercialize Fuel Cell Electric Vehicles (FCEV) by 2012 and will expand its domestic & overseas pilot fleet to a total of 100 units to improve quality through thorough testing.

The 2 trillion won investment in Hyundai Steel will be made this year for the 5.84 trillion won project, which is 58 percent completed*. The mill, which will consist of blast-furnaces, will be a world-class, eco-friendly integrated steel mill that will include a closed storage facility for raw materials, reducing dust. This immense project will not only create a large number of jobs, but contribute to South Korea’s national competitiveness by supplying high-quality steel to the nation’s core industries, such as the automobile, shipbuilding, electronics and machinery industries.

HKAG will also actively participate in efforts to create and share jobs. The group, which currently employs about 300 interns, will hire an additional 1,000 interns this year. The group will also continue its global student volunteer program, which sends 1,000 university students abroad to do volunteer work and gain experience.

Separately, as part of efforts to cut costs, HKAG last year already announced emergency contingency measures which include cutting executives’ salaries and the budget by 10 and 20 percent, respectively.

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