[Asia Economy Reporter Suyeon Woo] Hyundai Wia has succeeded in securing large-scale automotive parts orders from global automakers. By opening the door to large-scale supply contracts with premium automakers in Europe and North America, the company plans to diversify its sales channels beyond its traditional affiliate-centered transactions.
On the 29th, Hyundai Wia announced that it will supply constant velocity joints (C.V. Joints) worth 702.1 billion KRW to premium automakers in Europe and North America. More than half of these will be supplied to eco-friendly vehicles.
The constant velocity joint is a key component that transmits driving force from the engine and transmission to the wheels. This is the first time Hyundai Wia has secured a large-scale automotive parts supply contract with a premium European automaker.
Hyundai Wia was selected as the final supplier based on its long-standing know-how in manufacturing constant velocity joints. Since 1988, Hyundai Wia has mass-produced constant velocity joints for over 30 years, elevating its production and quality technology to a global top level. Based on this, in 2017, it became the first domestic automotive parts company to surpass cumulative production of 100 million constant velocity joints (two joints per vehicle), and has continuously increased production since then, currently producing over 10 million constant velocity joints annually.
Hyundai Wia’s technological capabilities in constant velocity joints also played a decisive role in winning the order. Hyundai Wia minimized noise and vibration (NVH, Noise·Vibration·Harshness) while significantly increasing stiffness and rotational angle. The weight of the constant velocity joints was also greatly reduced to contribute to vehicle lightweighting.
An employee of Hyundai Wia is inspecting a completed constant velocity joint at Hyundai Wia Changwon Plant 3 in Changwon-si, Gyeongsangnam-do on the 29th. Photo by Hyundai Wia
Hyundai Wia minimized logistics costs by utilizing its global production bases. Currently, Hyundai Wia produces 2.2 million constant velocity joints annually at its Jiangsu subsidiary in China and over 2 million annually at its India subsidiary. In 2018, mass production also began at its Mexico subsidiary, producing over 1 million constant velocity joints annually. Hyundai Wia plans to actively utilize its global production bases to deliver the ordered constant velocity joints in the most efficient manner.
A Hyundai Wia official explained, "We participated in the bidding based on the technology and mass production capabilities accumulated through producing over 100 million constant velocity joints," adding, "Thanks to excellent quality and technology, we were chosen as the final supplier by global automakers, especially for eco-friendly vehicles."
Starting with this order, Hyundai Wia plans to further diversify its global sales channels. Recently, Hyundai Wia is negotiating supply contracts worth several hundred billion KRW for constant velocity joints with other automakers in Europe and North America. Through this, the company aims to increase its global constant velocity joint market share from the current 8% to over 10%.
Furthermore, Hyundai Wia plans to expand exports of the 'Integrated Drive Axle (IDA),' which has changed the structure of constant velocity joints for the first time in 100 years, as well as engine and four-wheel drive parts. In particular, the IDA is a revolutionary product that has transformed the power transmission method of automobiles, which has been continuously used since the 1920s, and additional orders are expected in the future.
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