Hyundai and Kia invest £85.2m in UK-based electric van firm

Delivery firms including Royal Mail have expressed an interest in Arrival's electric van  Close   

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South Korean carmakers Hyundai and Kia will pour €100 million ($A161 million) into United Kingdom electric vehicle startup Arrival to develop purpose-built zero emissions delivery vehicles. It turns out that the delivery vehicles could be the "Trojan horse" for the electricity to really take off.

"The eco-friendly vehicle market in Europe is expected to grow rapidly due to reinforcement of environmental regulations", Hyundai's research and development department head Albert Biermann said.

Hyundai and Kia injected $89 million and $22 million, respectively, in the British company, which has developed in-house software, components and other technologies for the development of a next-generation electric vehicles, it said.

Dubbed "Generation 2 Electric Vehicles" these surpass traditional vehicles in cost, design and efficiency, and are created to be assembled by microfactories located to serve local communities. Arrival's vehicles are priced the same, or less than, current fossil fuel vehicles, making the decision to switch to electric inevitable, and increasing the adoption of electric technology globally.

Hyundai announced the development of its new fully electric Purpose Built Vehicle (PBV) at CES 2020 earlier in January, and Kia announced plans for a strategy aimed at developing more electric vehicles on Jan. 15.

"With the rapid global growth in online shopping, the volume of light commercial vehicles in urban areas has increased", an accompanying media release from Hyundai/Kia said. Demand for eco-friendly commercial vehicles is expected to rise as governments tighten environmental regulations further, the statement said.

The partnership appears to be primarily focused on Europe where there has been growing demand for eco-friendly commercial vehicles. Together the partnership represents a potentially winning combination to enable the imminent delivery of the next generation of scalable, objective built electric mobility solutions.

Hyundai Motor Company and Kia Motors Corporation made the investment jointly. "We will accelerate investment and cooperation with companies with advanced technology such as Arrival, to respond to the rapidly changing eco-friendly vehicle market". The company is conducting a number of pilot programs with a number of logistics companies in Europe, according to the announcement.

Under "open innovation" spirit, Hyundai and Kia are exploring partnerships with various businesses to build a leadership position in the rapidly expanding global EV market.

Electric vehicles integrate within commercial fleets effectively as they benefit from predictable routes and overnight depot charging.

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