In a development impacting the future of hydrogen fuel infrastructure in Korea, Hyundai Motor is set to incur additional financial responsibilities. This shift comes in the wake of the Korea Gas Corporation’s (KOGAS) decision to cease additional investments in the Hydrogen Energy Network (HyNet), a key operator of hydrogen refueling stations facing financial difficulties. KOGAS, with a 28.52 percent stake, has been the major shareholder in HyNet but has cited its own financial challenges as the reason for halting further financial support.
The responsibility for sustaining HyNet now falls on Hyundai Motor, which holds a 28.05 percent stake, making it the second-largest shareholder. KOGAS’s stance was articulated through a representative who highlighted the company’s financial woes, noting the completion of their committed investment of 30 billion won ($22 million) as per the joint venture agreement.
Established in 2019, HyNet has struggled with continuous financial losses, leading to a critical depletion of its capital. With a reported net loss of 8.4 billion won in 2022, worsening from the previous year’s 4.7 billion won loss, the company has sought to address its capital shortfall through several rounds of new share issuances from 2020 to 2022.
The refusal by KOGAS to engage in a capital increase in light of its soaring debt, which reached 47 trillion won by the end of 2023, places HyNet in a vulnerable state. The potential collapse of this leading hydrogen station operator poses a serious threat to the continuity of hydrogen fuel services in Korea, potentially derailing Hyundai Motor’s ambitious plans for a domestic hydrogen economy.
During CES 2024, Hyundai Motor Group’s Executive Chair Chung Euisun underlined the company’s long-term vision for hydrogen mobility, advocating for preparations that transcend the needs of the current generation. Hyundai’s forthcoming launch of a new version of the Nexo hydrogen-powered SUV underscores the company’s commitment to hydrogen technology. However, with diminishing governmental support for hydrogen initiatives, Hyundai Motor’s role in driving the hydrogen industry forward in Korea appears to be increasingly crucial.
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