Samsung Electronics and Hyundai Motor announced on Feb. 26 that they will join forces to develop advanced 5G (fifth-generation mobile communication) technology, which will be applied in Hyundai’s manufacturing plants worldwide. The two companies plan to market the 5G-based solution to global manufacturers together. The announcement comes just a day after Samsung, Hyundai Motor, and Kia Motors unveiled plans to co-develop a dedicated battery for robots.
Samsung and Hyundai, two of the world’s leading technology and automotive giants, are strengthening their so-called “manufacturing alliance” to navigate a rapidly changing industrial landscape where traditional boundaries continue to blur. By leveraging Samsung’s expertise in AI, semiconductors, and batteries and Hyundai’s strength in mobility and robotics, the companies aim to expand their global presence under their respective brand names.
Analysts say Samsung Electronics Chairman Lee Jae-yong and Hyundai Motor Group Chairman Chung Eui-sun are choosing cooperation to respond to growing uncertainties, including sluggish domestic demand and rising geopolitical risks associated with U.S. President Donald Trump’s second term.
Samsung and Hyundai’s latest collaboration focuses on “Reduced Capability,” or Red Cap, a new 5G private network technology. To prevent communication failures in advanced factories that use high-tech industrial equipment and robots, private 5G networks utilize dedicated frequency bands by establishing in-house 5G base stations instead of relying on external mobile networks. This enhances security and ensures ultra-fast, uninterrupted data transmission.
The 5G Red Cap technology that Samsung and Hyundai are working on is more advanced than existing 5G networks, allowing more devices to connect to the network while minimizing power consumption. This ensures seamless, high-speed data transmission across manufacturing sites.
“Previously, 5G private networks were limited to high-performance automation equipment like logistics robots, but Red Cap extends connectivity to a broader range of tools such as vehicle inspection systems, small wireless tools, cameras, and tablet PCs,” explained a Hyundai representative.
Hyundai plans to implement the technology at key manufacturing sites, starting with its new electric vehicle plant in Ulsan, which will begin operations in the first half of next year.
Samsung and Hyundai have been testing Red Cap technology at Samsung’s Suwon plant since January and plan to showcase it at next month’s Mobile World Congress (MWC) in Barcelona, targeting global manufacturers.
The latest initiative builds on the deepening partnership between the two conglomerates. Hyundai and Kia said they would develop a battery for robots with battery-maker Samsung SDI on Jan. 25. Last year, the two announced joint projects such as co-developing software to connect automobiles and consumer electronics in September and AI-driven software-defined vehicles (SDVs) in January.
The manufacturing alliance is spearheaded by Chairmans Lee and Chung, according to industry insiders. Historically, the two companies remained distant competitors, particularly after Samsung’s brief entry into the automotive industry in 1995. The two companies had little to no collaboration for over 20 years.
But their relationship began to change after a pivotal “battery meeting” in 2020, when Lee and Chung visited Samsung SDI’s battery plant. The partnership gained momentum in 2023 when Samsung began supplying semiconductors and batteries to Hyundai Motor.
Analysts say collaboration has become necessary as global competition intensifies. U.S. and Chinese companies, backed by substantial government support and rapid technological advancements, are gaining ground in key markets. By joining forces, Samsung and Hyundai are positioning themselves to better compete in the evolving global landscape and maintain leadership in smart manufacturing and mobility solutions.
