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At the New York Auto Show on Wednesday, Hyundai announced a strategic departure on its vehicles. CEO Jose Munos announced that they are adding focus to the US market, which is Hyundai’s largest market. They are investing $26 billion in the US and building a steel plant, while planning for 80% localization.
Photo by Larry Evans
And Hyundai is focusing its products on what American “customers want.” In terms of electrification, it is scaling back BEV plans and introducing more hybrids. While the 2026 World Performance Car IONIQ 6 N is still being offered, the regular IONIQ 6 has been discontinued, and its future is uncertain.
Photo by Larry Evans
Overall, EVs have been moved from the center stage and replaced with ICE vehicles. Hyundai is introducing body-on-frame, solid rear-axle SUVs and pickups. At the show, the Boulder SUV concept was revealed. It is not a small vehicle, and the show car embellishments undoubtedly make it look bigger. However, it is not as large as a full-size Suburban or Silverado. From the front, it reminds me of a 1986 K5 Chevy Blazer with a lift kit, big tires, and fender flares.
Photo by Larry Evans
No powertrain details were given, but most expect a hybrid system connected to the other end of the drive shaft. But why would Hyundai put so much investment into a future vehicle that seems to embody the architecture of the past?
Photo by Larry Evans
Shifting Strategy from EVs, But Kia Shows New EVs?
While not on their main stage, Hyundai Group’s Kia brand introduced the EV3 prototype at the show. This was a bit of a surprise, given the current environment. I had already seen it in 2024 in the Seoul airport, but I didn’t expect it here. Compact cars tend to have somewhat low margins and somewhat limited sales in the US. Production of the compact EV3 is expected to start later this year in Mexico, and I predict it will also become available in other LATAM markets. No price was mentioned, but somewhere in the thirties was discussed by several people at the show.
Photo by Larry Evans
Overall, the car is attractive. The materials that you interact with the most tend to be soft touch, but hard plastic makes up much of the interior. Up close, it becomes clear that costs were cut in some areas. It is front wheel drive based and uses a 400V platform with ternary batteries. As such, it will not charge as fast as some of its 800V vehicles. One of the journalists said that it reminded him of a Chinese market vehicle from 2020: more advanced than what people are used to in the US but not up to the current global cutting edge.
Photo by Larry Evans
Also at the display was a PV5 electric van dressed up like a NYC taxi. This was officially a concept, but it was interesting to show a van, given the brand-loyal van buyers in the US. EV vans also currently have a somewhat limited audience in the US.
But for a company that says it is shifting its strategy away from an emphasis on EVs, it seemed a bit out of place. To make these vehicles viable in the US, they need scale, which could be a challenge from just the Kia brand. Where is Kia going to get that scale?
Image Credit: Hyundai
GM Partnership Could Provide Answers
In 2024, GM and Hyundai entered an MOU to co-develop vehicles. This was updated in 2025. The partnership vehicles mentioned include midsized body-on-frame pickups/SUVs, compact cars, and an electric van. GM will lead the development of the midsized truck platform, while Hyundai will lead the development of the compact cars and EVs. They predict a total volume of 800,000 vehicles between the two companies. The first Chevrolet models under the partnership are the Onix, Tracker, Montana, and S10, focused on LATAM and to be built in South American plants.
Nobody outright said that the Hyundai and Kia models mentioned above would be part of the partnership, but the alignment is hard to ignore. As the brands have different appeals to different audiences, I would not expect them to be shouting from the rafters about the collaboration. Overall, the partnership gives both companies increased scale and part sharing ability.
As Jose Munos comes from Nissan, I would expect this to look more like the Nissan–Renault Alliance than an outright merger. Each company has strengths where the other has weaknesses. Despite co-developed platforms, the cars could still be significantly different and appeal to different markets. Hyundai, based in right-to-work states, also likely does not want the UAW. GM also probably likes having access to the non-union supply chain. Even if an outright merger is unlikely, the partnership builds on the strengths of each partner.
And the partnership could have broader implications. A couple of displays over from Kia’s 400V compact FWD EV to be launched later this year was Chevrolet’s 400V compact FWD EV, the Bolt. That was resurrected just this year but is soon to be discontinued. Could we see a Hyundai-based EV replace it? That would help create scale for the compact EV models in North America.
Several of the Hyundai-developed cars are also replacing Chinese-made, Chevy-branded vehicles in LATAM. Most GM-branded vehicles sold in Mexico are currently made in China. The Hyundai-developed vehicles also have an easier path to US entry. The core SAIC–GM joint venture once brought GM back to profitability after bankruptcy, but it has been hemorrhaging money lately in the competitive Chinese market. The 30-year joint venture agreement is up in 2027. Could the move to Hyundai signify the end of that JV?
Meanwhile, the SAIC–GM–Wuling (SGMW) joint venture (of which GM is a minority partner), is newer and more promising. This JV includes subcompact and mini EVs, such as the Chevy Spark EUV/Baojun Yep Plus that is sold in Mexico. SGMW has also been exploring manufacturing in Mexico. Could global GM brands have pickups and large SUVs developed by GM, Hyundai-developed compacts, and SGWM subcompacts? GM CEO Mary Barra likely has some answers, but she isn’t telling anyone yet.
Making Sense of the Shift
Overall, the New York Auto Show has declined. The automaker exhibits are now on one floor, with many OEMs not taking part. Hyundai/Kia now has the largest presence and the most significant announcements.
However, despite their size and growth, even Hyundai Group is facing challenges. They are being challenged in competitive markets, particularly around EVs, and are now focusing on restricted markets that are slower to adopt electrification. The move away from EVs feels like embracing the past. At the same time, fossil fuels are creating destruction and impacting affordability. That’s discouraging.
However, the collaboration between legacy auto has the potential to maintain scale of smaller, more efficient models and EVs. That scale could preserve some access to EVs at a somewhat affordable price. If the US new car market and policy shifts, vehicles still in production could increase output without the need for new product development. Partnership can also help to preserve viability without outright consolidation, as the markets where legacy auto offers competitive products shrink.
Of course, every potential answer creates new questions. Uncertainty is high. The recent shift away from EVs in the US is not encouraging. Politicians and lobbyists at the event indicated that they would go to great lengths to block any competition from the largest EV market globally. However, the situation could change again in the future.
Meanwhile, feel free to distract yourself watching Hyundai’s dancing robots:
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