An employee at Hyundai Mobis’ booth explains about the development of future cars during CES 2020 held in Las Vegas early this year. (Photo: Hyundai Mobis)

Hyundai Mobis, focusing on its own technology development and direct investments into foreign leading companies to secure future car technologies, is diversifying its technology strategies by investing in a global venture fund.

Hyundai Mobis said on July 2 the company will invest a combined $20 million (25 billion won) in ACVC Partners and MOTUS Ventures, element technology funds based in Silicon Valley of the United States.

The move may be construed as Hyundai Mobis’ attempt to secure core future car technologies and next-generation growth engines to brace for rapidly changing management conditions.

The steps will allow Hyundai Mobis to secure global strategic partners in advance, considered essential for the company’s strategies related to the development of future cars such as self-driving, electrification and connectivity.

Hyundai Mobis has so far invested about 1 trillion won in R&D outlays every year, as the company has been concentrating on its own technology development in the Mabuk and four global technology research institutes. I

n 2018, Hyundai Mobis succeeded in its own development of a radar sensor for which the company fully depended on imports.

The feat was followed by the securing of a passenger car camera system and in-cabin sensing technologies on its own.

Hyundai Mobis has also made direct investments into Korean and foreign leaders to secure core technologies in advance.

Starting with investing into StradVision, a Korean deep learning-based camera sensor firm, in 2018, Hyundai Mobis poured 60 billion in investment into Velodyne, a global LiDAR company, last year.

Velogyne is focusing on the development of a LiDAR sensor whose commercialization is slated for next year. Hyundai Motor Group established a joint venture with APTIV, a direct investment made in 2019.

Hyundai Mobis is accelerating efforts to secure technology through this indirect investment via a venture capital fund on top of its own technology development and direct investment into technology leaders.

The indirect investment method involves the utilization of venture capital funds’ global network, a departure from the direct investment designed to promote technology cooperation and joint development.

Hyundai Mobis plans to explore and nurture foreign startups with future car element technologies in a long-term perspective through its investment into venture capital funds.

Diverse collaboration opportunities are expected to be prepared as part of Hyundai Mobis’ mid- and long-term R&D strategies.

Startups, explored by ACVC Partners and MOTUS Ventures, specialize in next-generation censors, biometrics and robotics segments. They are based in North Americas.

The areas are not easy for commercialization in one or two years, but they are emerging as promising future technologies.

These tech funds are capable of exploring promising technologies of university research institutes and research institutions, and they support investment companies to have synergetic effects.

Hyundai Mobis is building an ecosystem with startups from an initial stage, and the company plans to make a massive equity investment if startups upgrade their technologies.

Hyundai Mobis has worked out a three-pronged strategy to secure stable technology development foundation: its own technology development, direct investment into global leaders and indirect investment into venture capital funds.

This year, the company is seeking to expand investments to explore investment and collaboration into promising startups in Europe and other regions other than Americas.

Meanwhile, global automakers and parts makers are investing into diverse venture capital funds to secure core technology sourcing in accordance with their respective strategies.

The reason is that they can secure information using strengths of each fund and networks and grasp technology trends.

The growth of foreign car ride-sharing firms and self-driving software solution providers, which have merged as unicorn companies, is believed to have been spurred by the direct investment into the firms on the part of global automaker and large-sized parts makers from an initial stage.