Korean automotive manufacturers Hyundai and Kia have announced a strategic investment of €100m (£85m) in a new partnership with Arrival, a UK-based electric commercial vehicle start-up.
Through the partnership, Hyundai and Kia plan to introduce competitively-priced small- and medium-sized electric vans and buses, as well as other products for logistics and on-demand ride-hailing and shuttle service companies.
Hyundai will contribute €80m (£68m) to the investment; Kia €20m (£17m). J.P. Morgan acted as exclusive financial advisor and placement agent for the private capital raising.
Avinash Rugoobur, Arrival’s chief strategy officer, said: “We are excited to come out of stealth mode with our partnership with Hyundai Motor Group, and our complementary expertise will allow us to rapidly design, build and roll out vehicles together.
“Accelerating electric vehicle adoption is good for everyone – for people, businesses and the planet – and we are pleased to undertake this mission with Hyundai and Kia.”
Through the course of the partnership, all three companies will use Arrival’s flexible skateboard platforms and technologies – including battery packs, electric motors and driveline components – to create new purpose built electric vehicles (PBVs) across multiple vehicle categories.
Hyundai and Kia will also leverage Arrival’s novel micro-factories and software development while Arrival will benefit from both OEMs’ global footprint and economies of scale.
According to Hyundai, the partnership will in turn allow it to accelerate its ‘two-track’ strategy to deliver battery-electric and hydrogen fuel-cell solutions for the European commercial vehicle market.
Albert Biermann, president and head of research and development for Hyundai, said: “Through the joint development of electric commercial vehicles with Arrival, we will be able to gain a competitive advantage and progressively establish our leadership in the global eco-friendly vehicle market, with Europe at the forefront.”
To further support that strategy, Hyundai recently established Hyundai Hydrogen Mobility, a joint venture between Hyundai and Swiss hydrogen energy company H2 Energy, which aims to export 1,600 hydrogen fuel-cell trucks to Europe by 2025, following the first export to Europe on January 3 as part of a pilot programme.