Hyundai Motor Group eyes Brazil as South American hydrogen hub

Hyundai Motor Group is positioning Brazil as its South American beachhead for hydrogen business. Building on a $1.1 billion investment pledge made in 2024, the group plans to establish a full hydrogen ecosystem in the country — spanning green hydrogen production, storage and transport through to hydrogen-powered trucks and fuel-cell applications.

According to Cheong Wa Dae and industry sources, Hyundai Motor Group announced Tuesday at the Korea-Brazil Business Roundtable in São Paulo that it would pursue technology cooperation with Brazil on green hydrogen production, hydrogen truck deployment and small modular reactors, in line with the country's decarbonization policy. President Lee Jae-myung, Hyundai Motor Group Executive Chair Euisun Chung and Brazilian Vice President Geraldo Alckmin attended the event alongside government and business representatives from both countries.

The group's vision goes well beyond selling a handful of vehicle models locally. The plan bundles the entire chain into a single integrated business: producing hydrogen from renewable sources such as solar and wind, storing and transporting it, then using it in trucks and industrial fuel cells. The group's hydrogen brand and business platform, HTWO, will serve as the organizing framework, combining technologies from across its affiliates.

Hyundai Motor and Hyundai Mobis will handle hydrogen fuel-cell vehicles and fuel-cell systems, while Hyundai Glovis will take on storage, transport and logistics operations. The energy and plant capabilities of Hyundai E&C and Hyundai Engineering are also expected to contribute.

Green hydrogen is produced by using electricity generated from renewable sources such as solar and wind to electrolyze water. The process emits virtually no carbon, but high electricity prices and the cost of electrolysis equipment make securing a stable demand base critical.

Hyundai Motor Group's approach is to deploy hydrogen commercial vehicles such as the Xcient first, creating demand for hydrogen, then use that demand to attract investment in the production and refueling infrastructure those vehicles require. The logic is that hydrogen prices and vehicle costs can only fall — creating a virtuous cycle — when hydrogen output and the number of vehicles on the road grow together.

Small modular reactors represent a separate energy-cooperation track alongside green hydrogen. SMRs are next-generation reactors assembled on-site from factory-built modules, offering shorter construction timelines and greater flexibility in meeting regional power demand than large conventional nuclear plants. Hyundai Motor Group is exploring SMRs as a way to supply stable power and heat to industrial complexes while expanding low-carbon energy sources.

The Brazil hydrogen business concept first took concrete shape during Executive Chair Chung's visit to the country in 2024. In February of that year, Chung met with President Luiz Inácio Lula da Silva and announced plans to invest $1.1 billion in Brazil's eco-friendly technology and green hydrogen sectors by 2032.

At the time, Chung said Hyundai Motor Group would "actively contribute to Brazil's hydrogen infrastructure and mobility sector." The group also outlined plans to expand a hydrogen network across Latin America with Brazil at its center, develop the hydrogen commercial vehicle market and supply fuel-cell systems. To that end, it established a dedicated Latin America hydrogen business unit in Brazil.

The plans announced during Chung's latest Brazil visit represent a meaningful expansion of the 2024 investment pledge into more specific business areas. The group's assessment is that long-term market growth requires not just selling hydrogen vehicles but also producing the hydrogen those vehicles will use locally and connecting the refueling and logistics infrastructure around them.

Hyundai Motor Group is also developing Brazil-specific eco-friendly vehicles in parallel. The plan calls for a locally exclusive powertrain that combines a flexible-fuel vehicle system — capable of running on a gasoline-ethanol blend — with a hybrid drivetrain. The strategy reflects Brazil's energy mix, in which bioethanol derived from sugarcane accounts for a large share of fuel consumption.

The group can also draw on its existing vehicle manufacturing base in the country. Hyundai Motor has operated a factory in Piracicaba, São Paulo state, since 2012, producing the Brazil-focused HB20 and the Creta SUV. The site also houses a research and development center and facilities belonging to affiliates and parts suppliers including Hyundai Mobis and Hyundai Steel. As the hydrogen business scales up, the existing automotive production and R&D hub could evolve into a broader base for eco-friendly mobility across Latin America.

Hyundai Motor Group has begun demonstrating hydrogen commercial vehicles in South America. In March, Hyundai Motor supplied eight Xcient hydrogen fuel-cell trucks to Uruguay's "Kairos Project" — the first time heavy-duty hydrogen trucks have entered commercial logistics service on the continent.

The project aims to cut carbon emissions from timber transport using green hydrogen produced by solar power. A 4.8-megawatt solar plant, an electrolysis facility capable of producing 77 metric tons of hydrogen annually, and a refueling station are being built together and are set to begin operation in November. The Xcient can travel up to approximately 720 kilometers on a single charge. Its ability to address the charging time and payload limitations that battery-electric trucks face in long-haul freight is considered one of hydrogen trucks' key advantages.

The Uruguay project is expected to serve as a proving ground for Hyundai Motor's broader Latin American hydrogen strategy centered on Brazil. Real-world operations will allow the group to verify vehicle durability, operating costs, and hydrogen production and refueling expenses — positioning it to expand into the mining, port and logistics industries of Brazil and other South American countries.

Hyundai Motor Group is expected to benefit from Brazilian government support tied to the country's green industry and energy policies as it advances its hydrogen business there.

Brazil's eco-friendly vehicle transition program, Mover, offers financial incentives for local research and development and investment in eco-friendly vehicle and parts production. The National Hydrogen Program provides an industrial foundation through hydrogen production support, certification frameworks and tax incentives. The National Energy Plan also pursues renewable energy expansion and the introduction of new energy sources as long-term priorities.

Hyundai Motor Group can leverage these policies to link its local production operations with its hydrogen business. With policy support in place, the group expects to ease the key barriers to wider hydrogen commercial vehicle adoption — including high hydrogen prices, insufficient refueling infrastructure and steep upfront vehicle costs.