The proposal, code-named "Project Beaver," was disclosed by Presidential chief of staff Kang Hoon-sik in an interview with Canada's CTV News, as a South Korean government-led consortium intensifies last-minute efforts ahead of Canada's final decision by the end of June.
According to CTV News, South Korea has offered to invest 3.1 billion Canadian dollars to build a hydrogen truck ecosystem in Canada if Hanwha Ocean wins the Canadian Patrol Submarine Project, or CPSP.
The project would use Hyundai Motor's hydrogen vehicle technology and include a liquefied hydrogen plant in British Columbia, 32 hydrogen refueling stations in British Columbia and Alberta, and a hydrogen vehicle manufacturing plant in Ontario. More than 160 additional refueling stations would be built after 2035.
Kang said the project would create about 9,000 jobs in Canada and help build a local hydrogen truck industry.
The proposal adds a new layer to South Korea's submarine bid, which has increasingly become a competition over industrial benefits as much as naval capability.
Hanwha Ocean, together with HD Hyundai Heavy Industries, is competing against Germany's Thyssenkrupp Marine Systems, or TKMS, for Canada's plan to acquire up to 12 conventionally powered submarines to replace its aging Victoria-class fleet.
From the early stages of the race, Canadian officials made clear that the winning bidder would be judged not only on submarine performance, but also on what kind of economic return it could bring to Canada.
In February, Stephen Fuhr, Canada's special envoy for defense procurement, visited Hanwha Ocean's Geoje shipyard and toured a KSS-III submarine undergoing sea trials.
"Both South Korea and Germany are automotive manufacturing nations," Fuhr said during the visit. "If there are areas where we can cooperate in sectors like automobiles, we are looking to pursue broader partnerships that go beyond defense."
The message reflected Canada's effort to protect and revive its auto industry at a time of U.S. tariff pressure, production cuts and uncertainty over the future of North American supply chains.
Reuters reported in January that Kang traveled to Canada with officials and executives from Hyundai Motor, Hanwha and HD Hyundai to lobby for the submarine project. At the time, Hyundai Motor said it had no current plan to build a car factory in Canada, but was exploring other partnerships, particularly in hydrogen.
Project Beaver appears to be Seoul's answer to that industrial demand.
He cited the case of Stellantis, which announced last year that it would move production of a Jeep model from Ontario to Illinois, saying Korean companies face similar pressure from the U.S.
"The U.S. told them it would be more advantageous to come to the U.S.," Kang said, referring to Stellantis. "South Korean companies are under similar pressure."
He also said it would be difficult for Korea to compete directly with China in the EV sector, given Beijing's strength in electric vehicles and Canada's ties with China on EV imports.
Project Beaver could mark a renewed attempt by Hyundai to expand its hydrogen business in North America, this time through heavy-duty trucks and infrastructure rather than passenger cars.
Hydrogen has been one of Hyundai Motor Group chairman Chung Eui-sun's key future strategies, with the group declaring 2040 as the target year for the mass adoption of hydrogen energy. But progress has been limited, partly due to the rapid rise of Chinese EV makers and the slow expansion of hydrogen refueling infrastructure.
Still, Hyundai has continued to build a track record in commercial hydrogen mobility. Its XCIENT Fuel Cell Truck has already surpassed 20 million kilometers of accumulated driving in Europe, while its North American operations have logged about 1.6 million kilometers since 2023.
The proposal suggests Hyundai may be seeking a more practical route into Canada's mobility market by focusing on long-haul freight, where hydrogen is seen as more competitive due to shorter refueling times and longer driving ranges compared with battery-only trucks.
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