The South Korean carmaker’s sales in China, the automaker’s biggest market, plummeted more than 50 percent due to a near-boycott movement among local customers amid a diplomatic row over Seoul’s decision to deploy the US’ Terminal High Altitude Area Defense anti-missile system. Many described the situation as an unprecedented crisis for Hyundai, which has been on a rollercoaster ride since the early 2000s.
Chung Eui-sun, heir to the world’s fifth-largest carmaker, however, said it was an opportunity for Hyundai to become stronger and that it would never undergo such hardship again.
|Hyundai Motor Vice Chairman Chung Eui-sun takes a look around CES 2018 (Hyundai Motor)|
“Last year, it was really serious. But (I believe) it was a good ‘vaccination’ for us. ... It was an opportunity for us to develop products that fit the demands from the local market and to hire many local staff by relocating our R&D unit,” he told reporters covering the Consumer Electronics Show in Las Vegas on Tuesday.
The vice chairman said the carmaker has changed its products, organization and designs, and is expecting to see positive signs later this year.
“Of course it was a difficult year for us, but I don’t think we’d experience such opportunity again,” he said, adding that he expects to see sales recover to pre-THAAD crisis levels, around 900,000 to 1 million units this year.
Asked about Hyundai’s ambiguous position between high-end brands and low-priced vehicles, Chung expressed confidence in the carmaker’s quality, but said it may take a while to secure product quality on par with luxury brands like Porsche.
Hyundai has its own high-end brand Genesis that hit the US market in late 2016. What concerns him is the pressure from competitors forcing Hyundai to lower the price of Genesis products. “But we shouldn’t get drawn into that. We may have to figure out a new way of keeping the price level high.”
Chung, 47, was attending the annual tech show to participate in Hyundai’s media events. The carmaker unveiled the next-generation fuel-cell hydrogen vehicle Nexo, touting it as the most desirable self-driving platform.
Addressed as “E.S. Chung” at the finale of Hyundai’s show on Monday, the vice chairman received avid attention from reporters coming from around the world, who surrounded him to ask about the Korean auto giant’s plans in future car technology.
Hyundai is a latecomer in the field of mobility services and autonomous driving. But it does not mean that the carmaker is doing nothing, he stressed.
“We are late because we want to do it right. ... We should not make (a quick) decision just to show it off. I believe it’s important to do it right and also make it profitable,” he said.
At CES, Hyundai announced its partnership with Aurora, a US startup led by Google’s former self-driving director Chris Urmson, to achieve its goal of future mobility.
Despite market buzz, with carmakers rushing to form alliances with tech companies to secure the lead in the emerging market of autonomous driving, Chung said the carmaker would not give up on maintaining the safety and quality of vehicles.
“Technology is important, but I believe it should be developed for the people, not just to show off,” he said.
Calling himself a fan of the Porsche 911 sports car and an admirer of Tesla’s challenging spirit, Chung said carmakers including Hyundai may have to change their way of doing business in order to survive in the changing industry, which is shifting to electrified vehicles operated by software instead of gasoline-powered cars in human hands.
“As we go electric and green, the way of working and everything should change ... maybe the way of making decisions and the speed of that should be a challenge for us because it will be important for us to become more like IT or ICT companies (or move) faster than them.”
Chung is the only son of Chairman Chung Mong-koo. He is the ninth-richest person in Korea by assets, with stock valued at $2.2 billion.
By Cho Chung-un, Korea Herald correspondent