According to industry sources on December 18, Hyundai Wia is in the final stages of preparation to mass-produce 1.6-liter Gamma hybrid engines at its plant in Monterrey, Nuevo León, Mexico. The company has been conducting trial production to validate manufacturing processes and product quality and will commence full-scale mass production from January next year.
This marks the first time Hyundai Wia will manufacture hybrid engines, signaling a strategic shift as global demand for hybrid vehicles accelerates.
Exclusive Supply for Kia K4 and K4 Hatchback Hybrids
All hybrid engines produced at Hyundai Wia’s Mexico plant will be supplied exclusively to Kia Corp. These engines will be installed in Kia K4 sedan and K4 Hatchback hybrid models, which will be manufactured at Kia’s Mexico plant beginning next year.
The Kia K4 and K4 Hatchback hybrids are scheduled for launch in the second half of next year and will be sold alongside existing internal combustion engine variants. Both models are strategic products supporting Kia’s global sales, particularly in North America and Europe.
Boosting Factory Utilization and Profitability
Engine and vehicle component sales accounted for 92% of Hyundai Wia’s total revenue, totaling 6.393 trillion won during the first three quarters of this year. However, the Mexico plant experienced limited operations this year due to production line conversions for hybrid engines.
The start of hybrid engine mass production for the K4 and K4 Hatchback is expected to significantly improve factory utilization rates and profitability. Hyundai Wia is reported to have the capacity to produce up to 200,000 hybrid engines annually, ensuring stable supply for Kia’s expanding hybrid lineup.
Kia K4 and K4 Hatchback Hybrids Expected to Drive Sales Growth
The K4 lineup plays a central role in Kia’s global sales performance. From January to October this year, Kia’s Mexico plant sold 161,179 units of K4 internal combustion models, accounting for 66% of total sales of 242,541 units.
With the addition of hybrid versions of the K4 sedan and K4 Hatchback, which offer improved fuel efficiency and lower emissions, Kia is expected to further increase sales volumes. Demand is particularly strong in the U.S. market, where consumers continue to favor hybrid vehicles over fully electric models.
Favorable Global Conditions for Hybrid Vehicles
Global market conditions are increasingly supportive of hybrid vehicles. Hyundai Motor Group, including Hyundai Motor and Kia, has been actively expanding its hybrid lineup in response to shifting regulatory and consumer trends.
The recent removal of electric vehicle purchase subsidies in the United States and signs that the European Union may reconsider its 2035 internal combustion engine ban have reinforced expectations that hybrid vehicle demand will grow as a transitional solution toward full electrification.
