2023.10.11 Hyundai Motor Company

[Hyundai Motors Technology Acquisition Biography Part 1] The road to securing unique technology starts with Pony

Hyundai Motor Company
Hyundai Motor Company’s obsession with its unique technology was for a better future. The Hyundai Motor Company’s technology acquisition process, from Korea’s first unique model, Pony, to the Accent, in which all key configurations of the car were completed by the company, is explained here.

Looking back on the past is to organize the traces we have taken so far and establish a new future direction through this. Through the book “The Development History of Namyang Research Institute,” published in 2013, Hyundai Motor Group summarized its accumulated R&D history and achievements while also pledging to prepare for the future of the ever-changing global automobile industry. The automaker is well aware that the achievements it has made so far do not guarantee the future, so it looked back on its past growth process to renew its attitude to secure future technology.

In particular, the parts related to the development of unique models in which Hyundai Motor Company established its technology, discussed in this book, evoke a lot of sympathy in the current era of electrification. Many believes that the Hyundai Motor Group’s leap forward into an advanced automobile manufacturer by securing and developing its own technology is an even more valuable result. The two articles, including this one, focus on the history of Hyundai Motor Company’s technology acquisition, starting from Korea’s first unique model, the Pony, to the Accent, which independently manufactured all core components of the car, as described in 〈The Development History of Namyang Research Institute〉.

After the launch of the Hyundai Pony, South Korea became the 9th country in the world to produce its own model

When it comes to cars representing Hyundai Motor Company in 2023, many will probably think of the IONIQ 5 and IONIQ 6, which are leading the global electrification market, the global best-seller Tucson, and the Palisade, which is much loved in the U.S. market. However, in the first 30 years of Hyundai Motor Company’s history, compact cars such as Pony, Pony Excel, Excel, and Accent were the core models. The history of these small cars shows that Hyundai Motor Company quickly acquired vehicle development technology.

The Accent, which was developed solely with the company’s own technology from the engine to the platform, is considered a meaningful model in the history of Korean automobile development

The first model, Pony, symbolizes Hyundai Motor Company’s commitment to ‘securing its own technological capabilities.’ Pony Excel and Excel, the further advanced successors to Pony, increased the proportion of domestically produced parts, leading to qualitative growth in the domestic auto parts industry. Accent, the successor to Excel, has finally completed all of the core components of the vehicle, such as engine, platform, and design, with its own technology. Above all, the Accent has an even more special meaning in that Hyundai Motor Company has secured complete development capabilities as an automobile manufacturer. Notably, the gap between Pony’s release and Accent’s debut was only 18 years; Hyundai Motor Company has laid the technological foundation to become a global automobile manufacturer in such a short period of time. Of course, that time was a series of endless challenges and overcoming hardships.

Hyundai Motor Company established its own development process

Before developing the Pony, Hyundai Motor Company assembled and produced passenger cars for Ford in Europe

Automobile manufacturing, steel, chemicals, and shipbuilding are representative heavy (chemical) industries. It literally refers to the heavy and chemical industry that produces heavy, thick, long, and large products, and because it involves large-scale investment and employment and creates high added value, it has great domestic and international influence. However, the barriers to entry are also high; Among them, automobiles are so closely related to our daily lives that they require more complex capabilities. This is because not only must it be competitive in terms of industry, but it must also have technology and marketability that meet the needs of consumers.

Hyundai Motor Company worked hard to secure its own technology in Korea, which was previously a barren area for the automobile industry, and as a result, succeeded in becoming a global automobile manufacturer with world-class powertrain and electrification competitiveness. Hyundai Motor Company’s challenge to secure technology began from the very beginning of its founding.

In 1973, Hyundai Motor Company began developing its first model

Hyundai Motor Company was officially launched as an automobile manufacturer in Korea in 1967. The following year, in 1968, Hyundai Motor Company established an automobile assembly plant in Ulsan and produced Ford’s compact sedan Cortina, and in 1969, Ford’s midsize sedan 20M using the CKD (Complete Knock Down) method. This method involves importing parts from overseas and assembling them domestically, allowing Hyundai to quickly supply cars to the country.

But the constraints were significant; Because the vehicles the company produced were not its own models, they could not change the design even if quality problems occurred or they wanted to modify the vehicles to suit the Korean environment. So the company’s founder, Ju-yung Chung, wanted to go further than just assembling cars. In the short term, it was much easier to import parts from overseas and assemble them, but in the long term, it would not have been possible to become an automobile manufacturer.

To overcome this, Chung focused on creating the company’s own models that could be sold both domestically and internationally, bearing the Hyundai emblem; This attempt was ultimately aimed at becoming a full-fledged automobile manufacturer by domestically producing all parts, including the engine. However, at the time, Korea’s automobile manufacturing infrastructure was so poor that it was not easy to even find out what the necessary processes were to develop a automobile. To overcome this, Hyundai Motor Company began establishing its own model development plan and specific processes in 1973.

Korea’s first unique model Pony (1976-1985): 90% domestically produced parts

Pony embodies Hyundai Motor Company’s obsession with technological development

Hyundai Motor Company launched the Pony in 1976, three years after it began developing its own model. The launch of Pony attracted a lot of attention from the global automobile industry. At that time, technological barriers between countries and companies were much higher, so it was believed that only developed countries and advanced automobile manufacturers could develop automobiles; However, as Hyundai developed its own models, it became a complete automobile manufacturer.

Hyundai Motor Company mobilized technology and manpower from Korea, Japan, and Italy to develop Pony. Mitsubishi’s compact car, the Lancer, was used to develop Pony’s chassis and powertrain, which are the framework and heart of the car. But for the suspension, steering, brakes, engine mounts, and exhaust system, the automaker disassembled the sample car and reverse engineered it for further development; They drew up all vehicle components and laid the foundation for rapid acquisition of related technologies.

Pony features a sophisticated design incorporating the latest European style at the time

Pony’s design was done by Italdesign, an Italian *carrozeria company. For reference, founder Giorgetto Giugiaro, who was leading Italdesign at the time, was already renowned for designing Volkswagen Golf, Isuzu 117, etc. Ten Hyundai Motors employees were dispatched to Italdesign for one year to learn the basics of automobile design and blueprint production methods to develop the Pony design. Through this, Hyundai Motors was able to take its first step toward developing car body design technology.

* Carrozeria: Companies specializing in automobile design development - often based in Italy.

Through Pony, Korea’s auto parts industry has grown significantly

Hyundai Motor Company made special efforts from the beginning to increase the localization rate of Pony’s parts. They only imported and installed a few items, such as carburetors, that could not be produced due to lack of domestic technology or marketability, but most of them used parts made with domestic technology. As a result, the local production rate of parts for the Pony was close to 90%, which was incomparable to that of the previously produced Cortina (21% in the first year of mass production, 31.31% after one year of mass production).

Pony was developed to suit Korea’s driving conditions and gained great popularity from domestic consumers

As the Pony was developed as a unique model, it was suitable for the body type and road conditions of Koreans and was easy to maintain and repair. This stood out as a clear difference from competing models that were directly imported from overseas. Also, naturally, as time passed, it was highly regarded among domestic drivers. With these advantages, Pony sold 10,726 units in the first year of its launch, accounting for 43.6% of domestic passenger car sales, and quickly became the most popular model. And from this time on, Hyundai cars began to be exported overseas; From July 1976 to December 1985, Hyundai Motor Company shipped a total of 67,387 Pony units (including Pony2) to the Middle East, Africa, South America, Canada, and Western Europe.

Stellar (1983-1997): Hyundai’s second model with an increased scope of in-house development

Stellar is a mid-size sedan with an impressive wedge-shaped body design that was popular in Europe in the 1980s

Even after the launch of the Pony, Hyundai’s midsize car lineup was still mainly dominated by the Cortina. Cortina was developed to run on well-paved roads in Europe, so it was not suited to the domestic driving environment where the road pavement rate was significantly low. Rather, because the compact car Pony had many outstanding advantages in terms of performance, the Cortina’s shortcomings were relatively more exposed, but there was no way for Hyundai to improve or modify the licensed model Cortina to suit the Korean environment. To overcome this problem, Hyundai Motor Company began the Y-Car Project to develop a new mid-size car using its own technology in 1978, less than three years after mass production of the Pony.

Stellar’s sophisticated design attracted many consumers

Stellar, launched in 1983, was the result of this and was the second unique model created based on the technology and know-how gained from the development of Pony. Unlike Pony, which was heavily influenced by Mitsubishi technology, Stellar’s biggest feature is that Hyundai’s unique development capabilities stand out. In particular, the automaker disassembled and compared/analyzed German sedans of the same class as the Cortina to develop the platform, then supplemented the shortcomings and improved its completeness; It was intended to strengthen durability by analyzing the technologies of European automobile manufacturers and adding only their strengths.

The opening area of the trunk was expanded to make it easier to load and unload cargo

When developing Stellar, Hyundai Motor Company directly selected its parts suppliers without going through Mitsubishi, and the nationalities of those companies also diversified to include not only Japanese but also American and European companies; For example, Stellar’s steering mechanism was supplied by TRW in the US, and its brake system was supplied by Girling in the UK. In addition, to strengthen engine performance, two Mitsubishi 1.4L and 1.6L models with proven durability were installed, and the lineup was later reorganized to include 1.5L, 1.8L, and 2.0L through several facelift models.

As with Pony, design development was handled by Giugiaro of Italdesign. Stellar’s exterior design was characterized by a long nose wedge style, which was popular in Europe at the time, and a wedge-shaped body with low air resistance and a lower windshield slope. Additionally, thanks to the reduction in air resistance, Stellar’s maximum speed, acceleration performance, and fuel efficiency have all been improved. As such, the significance of Stellar in terms of technology development was considerable. With Stellar, Hyundai Motors has completely escaped the influence of Ford technology, and as a comprehensive automobile manufacturer, has taken the opportunity to elevate its platform development technology capabilities to the next level.

Sales were also successful; From June 1983, when contracts began to be accepted, 10,000 contracts were received three months later, and it was difficult for production to keep up with the number of orders. This was because in Korea, where motorization was actively underway in the 1980s, consumer interest shifted from compact cars to mid-sized cars and larger. For reference, in the automobile market in the early 1980s when Stellar was first launched, mid-size cars were equivalent to today’s luxury cars. However, following the hosting of the 1988 Seoul Olympics, Stellar became more popular as national income increased and vehicle types diversified. Stellar, which was popular in the domestic automobile market for a long time, was sold until 1997. Meanwhile, Hyundai Motor Company, which accumulated its vehicle design skills by developing Pony, Porter, and Stellar, created the Pony Excel, a world-class front-wheel drive compact car.  [Continued in Part 2]

*Motorization: A phenomenon in which automobiles become widespread among the general public and become a daily necessity.

By Inju Lee

*Part 2 talks about the development history of Hyundai Pony Excel, Excel, and Accent.

HMG Journal Operation Team


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