Hyundai Motor's cumulative sales of hydrogen fuel cell vehicles in South Korea have surpassed 50,000 units, marking eight years since the launch of its dedicated model, the Nexo. Industry experts emphasize that to sustain the current growth of hydrogen vehicles, balanced support across passenger cars, commercial vehicles, and charging infrastructure is essential, along with effective policy implementation that reflects on-site conditions.
As of last month, Hyundai has sold a total of 50,262 hydrogen fuel cell vehicles domestically, according to the South Korean automotive industry. The domestic hydrogen vehicle market began to take shape with the launch of the Nexo in 2018, initially focusing on individual consumers in the passenger sector. Since 2019, the market has expanded into the commercial sector, coinciding with government policies promoting the eco-friendly transition of municipal buses.
The expansion of hydrogen vehicle adoption is also contributing to the development of the materials and components industry and job creation. Approximately 20,000 parts are used in hydrogen fuel cell vehicles, which have a higher component count than battery-powered electric vehicles. This allows existing internal combustion engine parts manufacturers to leverage their precision processing, assembly, and material technologies within the hydrogen vehicle supply chain.
The localization rate of key components in the mass-produced Nexo exceeds 90%, supported by a stable supply chain with over 60 partner companies. As of 2024, around 37,000 people are employed in the domestic hydrogen sector, with approximately 3,000 related companies forming the employment base of the hydrogen industry.
Industry stakeholders suggest that for the market to expand further, matching subsidies between national and local governments are necessary. Even if the central government secures national funding for hydrogen vehicle subsidies, delays in vehicle distribution occur if local governments do not allocate sufficient local funding.
As of the end of September this year, out of the 6,000 hydrogen passenger vehicles funded by the national government, local matching funds accounted for 5,093 units (84.9%). For commercial vehicles like hydrogen buses, the national allocation of 1,800 units saw local funding only securing about 1,270 units (70.6%), indicating a larger gap.
Low execution rates could lead to budget cuts in the following year, potentially stifling the market's capacity for expansion. In fact, the proposed budget for hydrogen vehicle subsidies in 2027 has been reduced by 23%, from 576.2 billion won to 445.7 billion won, citing poor execution rates as a reason.
Expansion of charging infrastructure is also necessary. The government set a goal to establish 310 charging stations nationwide by 2022, but as of 2026, there are only about 250 hydrogen charging stations across the country.
* This article has been translated by AI.
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