Due to a lack of Korean engineers with that kind of experience, it took Hyundai nearly two years just to assemble a relevant team. The Korean auto company didn't launch its first gasoline-electric drivetrain until 2010, in the Sonata Hybrid.
Now, Hyundai and Kia plan to leapfrog to the front of the industry's pack.
Their catch-up plan: Launch 26 hybrids, plug-ins, electric vehicles and fuel cell vehicles by 2020. When accomplished, Lee promises, the rollout will catapult the group to the global No. 2 spot in electrified cars, ahead of all automakers but Toyota.
It's a risky but necessary gambit. After years of trailing in electrification, Hyundai and Kia see no way of meeting future emissions rules without harnessing the power of electrons.
The two export-dependent brands face the same challenges as other automakers in meeting those rules: having to place costly bets on sometimes unproven, next-generation drivetrains and meeting different consumer tastes and regulations in markets as diverse as the U.S., China and Europe. A wrong bet could drain valuable capital and steer the company down an expensive blind alley.
The Hyundai-Kia group dominates its home market, but that market isn't large enough to provide the solid sales base that other makers, say General Motors in the U.S. or Volkswagen AG in Europe, can count on to support economies of scale in developing critical new components.
"I have to prepare for all possibilities," Lee told Automotive News on the sidelines of an electric vehicle expo here. "It's a headache, but we have to adapt to that.
"It's really difficult for us."
Hence a scattershot approach. The 26 planned vehicles include at least 12 hybrids, six plug-in hybrids, two EVs and two fuel cell vehicles spread across the Hyundai and Kia lineups.
The rollout covers several nameplates already on sale or heading to lots soon. From Hyundai, they include the Sonata Hybrid, Sonata Plug-in, Ioniq Hybrid, Ioniq Plug-in, Ioniq Electric, Grandeur Hybrid and a fuel cell version of the Tucson. The Grandeur is sold in the U.S. as the Azera, but slow sales there make it unclear whether the next-generation Grandeur will come to U.S. showrooms.
At Kia, the list includes the Optima Hybrid, Optima Plug-in, Soul EV, Cadenza Hybrid and the upcoming Niro hybrid compact crossover.
"This is the basement that we will build upon," said Lee, senior vice president for the Hyundai Motor Group's Eco Technology Center, which works on electrified drivetrains.
The timing of the electrification push is problematic. The green-car surge comes as ultralow pump prices fuel a frenzy for trucks. Through February, truck sales accounted for 59 percent of overall U.S. sales but just 29 percent of Hyundai-Kia volume. Dealers are skeptical about the direction.
"I'm also worrying," Lee said of gasoline prices.
But given an eco-car penetration rate that he called "miserable," the group has "no choice" but to forge ahead, Lee said. Electrified cars account for a mere 1 percent of global sales at both the Hyundai and Kia brands.
Low volume
While the Hyundai Motor Group aims to be the No. 2 volume player in a scant four years, it hasn't released a sales target.
Lee said it should be more than four times the current volume, implying 2020 sales of around 300,000 vehicles or more.
Last year, Hyundai sold 42,900 hybrids and plug-ins worldwide. It delivered 300 fuel cell vehicles but didn't offer an EV. Kia moved just 18,735 hybrids. It doesn't have a plug-in or fuel cell. Its Soul EV tallied sales of 8,450.
Toyota, by contrast, sold 1.2 million hybrids and plug-in hybrids in 2015.
Analysts call Hyundai's goal largely symbolic.
"Whether it's officially No. 2 isn't really the issue, but it needs to have real-world electric car offerings ASAP," said Karl Brauer, senior director of automotive industry insights at Kelley Blue Book.
"Hyundai-Kia will have to establish a cost-effective supply chain for batteries and motors, and it will need vehicle designs that allow for the easy integration of electric powertrains."
Hyundai's meager volume throws up major cost challenges.
The key will be leveraging common components between Hyundai and Kia. After studying the needs, Lee's team determined that only a minimum of variants could cover all their eco-car needs.
"For example, all our electric motors have the same diameter," Lee said. "The power output is different, but we can just adjust the width of the core winding. Or for the motor controller, we standardized to use the same printed circuit boards."
While each nameplate generates modest volume of up to 20,000 units, volume expands beyond 100,000 on a component basis, he said.
"Except for Toyota, I can achieve some competitiveness against other companies," Lee said.
Hyundai's green cars are not yielding profits yet, but Lee aims to change that, too. "Our target is before 2020, we would like to make profits on these eco-friendly vehicles," he said.
Tailing Toyota
It is all part of a long-term strategy dubbed Project Ioniq, which takes its name from Hyundai's new trio of Ioniq electrified vehicles.
The strategy, announced at last month's Geneva auto show, encapsulates a host of ambitions to reposition the car as a "driving device, not a machine." It targets innovation in safety, connectivity, handling, design and future mobility.
For Lee, catching Toyota is a personal and professional passion. When Toyota launched the Prius hybrid in 1997, Hyundai did not take the gasoline-electric technology seriously, he said.
By 2003, however, Hyundai sensed it had better get onboard or fall behind. Lee joined in 2005 to kick it into high gear.
"To be on the safe side, we had to prepare something," recounted Lee, who previously helped to develop internal combustion engines. "They were struggling. We could not find any proper engineers or specialists in our company."
Analysts say Hyundai must nail the drivetrain to win buyers.
"The products need to deliver competitive metrics, MPGe, range, power, with some "wins' over the competition," Stephanie Brinley, an auto analyst with IHS Automotive, wrote in an email to Automotive News.
When the Ioniq arrives in the U.S. this fall, Hyundai hopes finally to notch some of those wins, Lee said.
He promises that the hybrid version will not only eclipse the Prius in combined fuel economy but deliver sportier driving, thanks partly to its suspension and dual-clutch transmission.
Hyundai aims to market it under a "green performance" banner.
Meanwhile, the Ioniq Plug-in also pips its Toyota counterpart, the Prius Prime unveiled at the New York auto show in March. It gets an EV-only range of more than 25 miles (40km), compared with the Toyota plug-in's 22 miles (35 km).
"Personally, it has really big meaning for me," Lee said of beating the Prius. "If I catch up to that technology level, I think I can be the happiest engineer in the world."
