DETROIT/SEOUL: General Motors and Hyundai Motor have announced plans to co-develop five new vehicles, aiming to cut costs and strengthen their position in global markets where Chinese electric vehicle makers are gaining ground.

Four of the planned models, a compact SUV, car, pickup, and a mid-size pickup, are set for launch in Central and South America in 2028 and will support both internal combustion and hybrid powertrains.

The companies did not specify production locations but expect to manufacture at least 800,000 vehicles annually once operating at full capacity.

The move is seen as a response to growing competition from Chinese EV brands in Latin America, though some analysts expressed skepticism about its effectiveness.

“Even if they sell those new models in South America, it’s hard to beat Chinese competitors which already are leading in the electric-vehicle market with low prices,” said An Hyung-jin, chief investment officer at Seoul-based Billionfold Asset Management.

“Hyundai might be able to learn from GM about how to build pickup trucks, but it would take some time to generate earnings,” he added.

In addition to the passenger vehicles, GM and Hyundai plan to co-develop an electric commercial van in the U.S. as early as 2028.

“The partnership itself is a win-win strategy, since GM can learn the hybrid technology from Hyundai while Hyundai can use the relationship with GM as leverage for trade negotiations with the United States,” said Teddi Kim, head of auto research firm Mirae-Mobility Research & Services.

The announcement follows last week’s U.S.-South Korea agreement to impose a 15 percent tariff on American imports from South Korea, including vehicles.

Hyundai Motor shares rose 0.7 percent following the news, slightly outperforming the broader market.

The deal adds to a recent flurry of partnerships between South Korean and U.S. firms, including Samsung’s chip deals with Tesla and Apple, and LG Energy Solution’s battery pact with Tesla.

Reuters previously reported in March that Hyundai and GM were nearing a deal to collaborate on commercial vans and pickups.

The agreement marks Hyundai’s first major vehicle development partnership. For GM, it comes after a string of discontinued joint projects, including the 2023 cancellation of a US$5 billion EV partnership with Honda.

Legacy automakers are facing pressure to cut costs as Chinese rivals flood global markets with high-tech, low-cost electric vehicles. Partnerships are increasingly seen as a way to share development burdens and stay competitive, especially as global tariffs add billions in costs across the supply chain.