Hybrid cars and fuel-cell cars based on alternative energy sources such as electricity and hydrogen are now essential for global carmakers aiming to survive the fierce competition in the global market.

Hyundai-Kia Automotive Group has also been no exception with its development of low-pollution emission-free cars and other future-oriented vehicles over the past years as its new growth engine.

Different from the first-generation fuel-cell Santa Fe in 2000 and second-generation fuel-cell Tucson in 2004, both of which were adaptations of existing models, the i-Blue is the first concept car designed as an “all-fuel cell” vehicle from the outset.

Hyundai Motor also displayed its advanced technology to lighten the size and weight of core auto parts for smaller fuel-cell cars in the future with the i-Blue, a mid-size CUV (crossover utility vehicle) that combines the merits of sedans and minivans.

Amid widespread concerns over environmental problems the term “environmental management” has become a key factor for sustainable growth of enterprises.

Hyundai-Kia Group Chairman Chung Mong-koo adopted environmental management in 2003 as one of his principal management strategies for the 21st century.

While the company has exerted continuous efforts to enhance the fuel efficiency of conventional gasoline and diesel cars, Hyundai Motor has more recently stepped up its development of cars that use alternative energy sources.

With its fuel-cell Tucson, in particular, the top South Korean automaker took part in a project with the U.S. Department of Energy in 2004 to set up the infrastructure for hydrogen fuel stations and test-drive hydrogen cars along with other global carmakers.

Hyundai Motor has also made efforts to commercialize hybrid cars, which use two or more distinct power systems such as electricity together with gasoline or diesel engines to achieve better fuel economy and reduce pollutants in exhaust gas.

For such research and development (R&D), Hyundai Motor set up the Environmental Technology Research Institute in Yongin, Gyeonggi Province, in September 2005.

“From the development of new products to production, sales and after-sales service, the institute became the Mecca of environmental technologies to cope with the ever-strengthening environmental regulations around the world,” said a company spokesman.

Hyundai Motor now funnels billions of dollars into hybrid and fuel-cell vehicles after first embarking on the development of futuristic vehicles in 1995. It set aside some 2.57 trillion won ($2.78 billion) along with Kia Motors for this year’s R&D activities.

Since the first introduction of its hybrid concept cars “FGV1” and “FGV2” in 1995 and 1999, the company has already applied its accumulated technologies into several of its models such as the “Avante” and “Verna” in 1999 and 2000, respectively.

In 2004, under a joint project with the Ministry of Environment, the company also had 50 “Click” hybrid models road-tested and provided a total of 312 hybrid vehicles including the “Verna” and “Pride” to public organizations in Seoul.

Hyundai Motor sold 369 hybrid vehicles to public organizations last year and it now plans to sell 3,390 more across the country by 2008, advancing the 2″era of hybrid cars.”

Hyundai Motor has come up with a plan to begin mass production of hybrid cars in 2009 and bring up its annual production to 300,000 per year by 2015. But experts stressed that the company should make more efforts to achieve the goal.

Dr. Cho Cheol, a researcher at the Korea Institute for Industrial Economics and Trade (KIET), said in a recent report that it would be probably after 2011 at the earliest for South Korean carmakers begin mass production.

Cho, however, expected that the country’s level of technology for hybrid cars could reach 70-75 percent of that of Japan by 2010 and 90-95 percent by 2020, up from the current 60-65 percent.