UPDATE 2-Hyundai Motor to launch first battery-powered electric car in 2016

Tue Mar 11, 2014 6:19am EDT

(Recasts, adds U.S. zero-emission rule)

* Fuel-cell focused Hyundai answers calls for more zero-emission cars

* Battery focused Kia likely to sell fuel-cell car in the future

* Kia aims to sell 5,000 Soul EVs globally this year

By Hyunjoo Jin

HWASEONG, South Korea, March 11 (Reuters) - Hyundai Motor Co , South Korea's champion of fuel-cell electric vehicles (EV), will answer calls for manufacturers to make more zero-emission cars by launching its first rechargeable battery-powered vehicle in 2016.

Hyundai, like Japanese rival Toyota Motor Corp, has long concentrated on fuel-cell vehicles powered by electricity generated using hydrogen, touting their longer driving range and shorter refill times.

But like Toyota, Hyundai is expanding its offering by also investing in battery-powered cars - the staple green offering of Hyundai affiliate Kia Motors Corp.

"There is no clear direction about which eco-friendly cars will win. We are dividing the roles of Hyundai and Kia, with Hyundai launching fuel cell cars and Kia focusing on electric cars," said Senior Vice President Lee Ki-sang, who leads the eco-friendly car divisions of both Hyundai and Kia.

"But the time will come when Kia will introduce a fuel-cell car. Hyundai is also preparing to launch a (battery-powered) electric car in 2016."

Zero-emission vehicles are likely to become a more frequent sight as governments devise environment-friendly initiatives. California, for instance, requires auto makers produce a certain percentage of zero-emission vehicles as part of their overall fleet or buy credits from manufacturers who have produced more.

BATTERY-POWERED

Kia, 34 percent owned by Hyundai, has favoured battery-powered cars because they can be charged at home as well as at charging stations. Fuel-cell cars must be refilled with hydrogen only at filling stations.

So far, a lack of charging stations and relatively short driving ranges, as well as high prices resulting from the cost of batteries, has kept the battery-powered EV market niche.

Korean sales of Kia's Ray EV, Renault SA's SM3 EV and General Motors Co's Spark EV totalled just 713 vehicles last year, industry data showed. Hyundai's BlueOn is only used by government agencies.

Even so, the number of battery-powered EVs is on the rise, as BMW's i3 and Nissan Motor Co Ltd's Leaf are widely expected to reach Korea this year - as will Kia's Soul EV.

At a news conference on Tuesday, Kia said it will start building a battery-powered version of its Soul compact in Korea next month. The car will be Hyundai-Kia's first battery-powered EV export, with destinations including the U.S. and Europe.

For this year, the global sales target is 5,000 Soul EVs, said Cho Yong-won, vice president of Kia's Domestic Marketing Group.

In Korea, the Soul EV will cost about half of its 42 million won ($39,400) price tag after government subsidies, similar to the higher-end model of the gasoline version.

The car can run up to 148 km (92 miles) per 24 to 33 minute fast charge or four hours on slow charge.

($1 = 1066.5000 Korean won) (Additional reporting by Norihiko Shirouzu in BEIJING; Editing by Christopher Cushing)

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