[Click eStock] "Sang-A Frontec, Hydrogen Car Outlook Still Bright"

Genesis Hydrogen Car Temporarily Halted with 12% Drop the Previous Day
"Temporary Concerns... Hydrogen Car Industry Outlook Still Bright"

[Asia Economy Reporter Minwoo Lee] Although the stock price of Sanga Front Tech plummeted following the news that Hyundai Motor temporarily suspended the Genesis hydrogen car project, which was aimed for release in 2025, analysis suggests that the outlook for the hydrogen car industry remains bright. Since Hyundai Motor's plan to develop hydrogen commercial vehicles remains unchanged, the decline is seen as a temporary correction.

On the 29th, Eugene Investment & Securities maintained a "Buy" rating and a target price of 100,000 KRW for Sanga Front Tech, a key producer of membranes used in polymer electrolyte membrane fuel cells (PEMFC). The previous day, Sanga Front Tech closed at 51,500 KRW, down 12.9% in a single day.

The news of Hyundai Motor's temporary suspension of the Genesis hydrogen car development raised concerns about the hydrogen economy. According to industry sources, Hyundai Motor judged that the performance of the third-generation hydrogen fuel cell development did not meet the initial targets and reduced the role of the existing fuel cell department. Hyundai Motor explained that while they are reorganizing the responsible team and adjusting the R&D schedule, this does not mean the discontinuation of new car development. Researcher Byunghwa Han of Eugene Investment & Securities stated, "The reason Hyundai Motor and Toyota are focusing their initial hydrogen car investments on passenger vehicles is to achieve the development of materials and parts and establish a mass production system as an intermediate step," adding, "There may be pipeline adjustments during the development process, but the overall hydrogen car growth plan will not be significantly affected."

He also emphasized the bright outlook for the hydrogen car industry itself. Starting next year, the U.S. government will invest budget not only in hydrogen cars but also in the entire hydrogen industry. It is analyzed that a market focused on hydrogen commercial vehicles will form around 2024, when eco-friendly truck mandates are introduced in California, New York, New Jersey, and other states. The European Union (EU) and China are also focusing on securing hydrogen cars and hydrogen refueling infrastructure. The economic viability of hydrogen fuel cells is improving over time. Unlike electric vehicles, hydrogen fuel cells are less affected by raw material costs and more dependent on processing and development costs.

Researcher Han explained, "Hydrogen cars are at an early stage similar to electric vehicles 10 years ago, so judgments should be made with future growth in mind rather than current economic viability," adding, "Hydrogen cars and the hydrogen era are essential elements for achieving carbon neutrality."