The global car industry is showing no convincing signs of recovery
yet as sluggishness in developed economies has deeply dented demand, a
Hyundai Motor Group vice chairman said on Wednesday.

But auto markets in China, India and Brazil should outperform,
helped by government incentives, growing incomes and faster economic
recovery, said Lee Hyun-soon, who heads research and development at the

The world's No.5 automaker aims to increase its share of those
markets with targeted launches, but has no plans to bring forward
production schedules for more environmentally friendly cars.

It is difficult to say the global car market is showing signs of
recovery as the U.S. and European markets remain weak, Lee told
Reuters in an interview at Hyundai Motor's research and development
center in Whasung, southeast of Seoul.

The group plans to launch unique models in China, add new models in
India, and develop small cars which can run on ethanol in Brazil to
expand market shares in those markets, Lee said.

The group, which owns South Korea's top two auto makers -- Hyundai Motor Co (005380.KS) and Kia Motors Corp (000270.KS)
-- does not plan to start mass production of eco-cars earlier than
currently scheduled though it has the technology to do so, the vice
chairman said.

A greater priority is improving the fuel efficiency of conventional cars, said Lee, who joined Hyundai Motor in 1984.

Our (environmental) technology is ready. But the problem is money
and infrastructure. We have to see how the government would support it
and if customers would pay big money, he said.

Hyundai plans to launch a plug-in hybrid model in the United States,
but the company will see customers' reaction to General Motors Corp's (GM.N) Chevrolet Volt before launching its own version, Lee said.

Earlier this month, Hyundai unveiled the Elantra LPI, a hybrid
version of its popular compact car, which will be powered by liquefied
petroleum gas (LPG) and lithium polymer batteries.

Hyundai plans to start mass production of gasoline hybrid cars next year and of plug-in hybrids from late 2012.

The group also aims to improve fuel efficiency by 25 percent for
gasoline models and 15 percent for diesel cars by 2015, he said.

It is spending 20-30 percent of its research and development budget
on improving fuel economy, almost the same as its investment in
environmentally friendly models, Lee said.

People have an illusion that hybrid (cars) can solve all the
problems ... But hybrid models are less than 1 percent of global car
(sales) and the proportion would grow to just 5 percent in the next 5
years, Lee said.

If we do not improve the fuel efficiency of conventional cars, we cannot solve those problems.

(Editing by John Stonestreet)