Ethanol is emerging as a new option in the electrification market, following gasoline and diesel. Major automakers from South Korea, China, and Japan are increasingly focusing on developing hybrids that combine ethanol with electrification technology. If the related market expands, it is expected to benefit domestic parts manufacturers that produce electrification and fuel system components.
According to the automotive industry on August 10, Hyundai Motor Company has begun developing ethanol hybrid vehicles aimed at the Brazilian market. This initiative gained momentum after Euisun Chung, chairman of Hyundai Motor Group, visited Brazil last month and instructed local executives to develop hybrid vehicles utilizing local eco-friendly fuels, including ethanol.
The ethanol hybrid being developed by Hyundai is expected to combine hybrid technology with a flex-fuel (FFV) engine that can run on both gasoline and ethanol. It is seen as a strategic model to follow the popular HB20 in Brazil.
The HB20, a hatchback, is Hyundai's best-selling model in Brazil, equipped with a 1.0-liter flex engine that can use both gasoline and ethanol. Last year, 85,029 units of the HB20 were sold, along with 36,947 units of the sedan version, the HB20S. Hyundai plans to enhance its competitiveness in the local market by addressing the fuel efficiency drawbacks of ethanol compared to gasoline through hybrid technology. The urban fuel efficiency for the HB20 1.0-liter turbo model is 13.4 km per liter for gasoline and 9.4 km per liter for ethanol.
Toyota also commercialized the world's first flex-fuel hybrid in Brazil in 2019, applying the technology to its Corolla compact sedan and other models. Chinese automaker BYD introduced the 'Song Pro Super Hybrid Flex Fuel' in the Brazilian market last year, integrating flex-fuel technology into its plug-in hybrid electric vehicles (PHEVs).
The interest of South Korean, Chinese, and Japanese automakers in ethanol hybrids is driven by the market potential in Brazil and India. Brazil is a leading producer of sugarcane, with a well-developed infrastructure for bioethanol production and related fueling stations. India, the world's third-largest automotive market, is promoting policies to increase the ethanol blending ratio in gasoline to reduce its dependence on crude oil imports and foster its domestic biofuel industry. Recently, vehicles with an ethanol content of up to 85%, known as E85, have emerged.
According to the Brazilian Electric Vehicle Association (ABVE), sales of electrified vehicles in Brazil reached 223,912 units last year, a 26% increase from the previous year. Among these, 101,364 were PHEVs, and 21,323 were flex-fuel hybrids (HEV Flex) capable of using ethanol.
This trend could present new opportunities for domestic automotive parts manufacturers. Hyundai Kefico is developing coating technology to enhance the durability of high-pressure injectors in bioethanol fuel environments. Hyundai Mobis, which produces electrification components such as hybrid battery systems, is also expected to benefit from this shift.
* This article has been translated by AI.
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