The EU's Carbon Border Adjustment Mechanism (CBAM) entered its definitive phase in January 2026, creating a new carbon cost for imports of emissions-intensive products into the European Union. For Korean automotive manufacturers with European assembly hubs, the carbon cost embedded in imported steel is becoming an increasingly important financial consideration.

Despite its growing relevance, public disclosure on future CBAM liabilities remains limited. Hyundai Motor Company has disclosed a projected CBAM-related cost as of 2030, while Kia has not published a comparable estimate. Existing disclosures also provide little information on the underlying assumptions, methodologies, or key variables used to derive these figures.

This report examines the potential steel-related CBAM exposure of Hyundai Motor Group's European operations and identifies the disclosure gaps that currently prevent investors from independently assessing these future liabilities. It also highlights inconsistencies between existing corporate disclosures and previous research on steel consumption within Hyundai Motor Group.

Using publicly available data, the report develops a transparent scenario-based financial model to estimate a range of potential steel-related CBAM costs under different assumptions. The analysis discusses the key drivers of future liabilities—including embedded emissions, production pathways, procurement choices, EUA price trajectories, and regulatory developments—while clearly explaining the limitations and uncertainties of the modeling approach.

In addition, the report outlines the information investors would need to independently evaluate CBAM-related financial exposure, including verified carbon intensity, steel sourcing, production routes, imported product scope, modeling assumptions, and disclosure methodologies. It also explains the current treatment of Korean ETS deductions under Regulation (EU) 2023/956 and identifies regulatory developments that may affect future calculations.

Overall, the report provides a practical framework for understanding how CBAM may affect Hyundai Motor Group's steel-related costs and demonstrates why greater transparency is needed for investors to assess climate-related financial risk.