Hyundai Motor reshuffles overseas units to deal with changing markets

Hyundai Motor Co., South Korea’s top automaker, has reorganized its overseas units, reducing the number of business sectors to five from nine, to quickly adapt to rapidly changing global market demands in the group’s push to become the world’s No. 3 player.

Hyundai restructured the nine regional units that managed North America, Latin America, Europe, China, India, Russia, Africa-Middle East, the Asia-Pacific and South Korea to consolidate them into five as part of Hyundai Motor Group’s personnel reshuffle announced on Dec. 17, according to industry sources.

The carmaker set up a division to manage the North and Latin American units while placing its trailer business in the US and Mexico -- under Hyundai Translead and Hyundai de Mexico (HYMEX) -- the sources said on Dec. 19. Hyundai Translead and HYMEX had been managed by Hyundai headquarters’ global business management office. The move is to give more authority to the North American unit that reported the best earnings ever and enhance responsible management in the Americas.

Hyundai has also created a unit to handle the Russian and European markets, appointing Hyundai Motor Europe President and CEO Michael Cole as the unit’s head. Cole will maintain the chief post of the European market. Hyundai and its affiliate Kia Corp. are on course to account for 8% of the European market for the first time with a market share of 4.4% and 4.3% in the first 11 months of the year, respectively.

Hyundai established a division to control the Indian and the Africa-Middle East units. Kim Unsoo, Hyundai Motor India’s new managing director, is set to lead the division and the Indian business. Hyundai has been increasing investment in the rapidly growing Indian market with a plan to spend 40 billion rupees ($530 million) on research and development to launch six electric vehicle models by 2028 there.

The company is planning to set up a division to manage the South Korean and Asia-Pacific markets in February 2022. It aims to utilize the core manpower at its domestic business unit within its headquarters to compete against Toyota Motor Corp., the No. 1 player in Southeast Asia. Hyundai created a unit for the Vietnam market this month.

RESPONSIBLE MANAGEMENT FOR EACH REGION

Hyundai reorganized the global business units to enhance the autonomous management system that gives authority and responsibility to the units for each region. The move is expected to help the company respond quickly to the rapidly changing demands of each market.

Chairman Chung Euisun has emphasized the independent management of regional divisions.

“We need to establish a profitability oriented business system based on the responsible management of each region, while the headquarters actively support them,” Chung said last year in a New Year's message.

The newly established divisions will manage business strategies, production and sales of each unit to maximize synergies between regions.

CHINA

Meanwhile, Hyundai overhauled management for the Chinese unit to recover its business in the world’s largest automobile market. Hyundai Motor Group China’s president and head Lee Kwang-guk stepped down to become an adviser, while senior vice president Lee Hyuk-joon was named to lead the Chinese operation.

Beijing Hyundai, the joint venture between Hyundai Motor and China's BAIC Motor Corp. Ltd., fired most executives in key sectors such as planning, technology and sales.

The combined market share of Hyundai and Kia in China fell to a record low of 1.8% last month from 2.7% in August.

“Hyundai needs a mid- to long-term turnaround strategy rather than impractical plans for a short-term rebound,” said an industry source.

Write to Il-Gue Kim and Hyung-Kyu Kim at black0419@hankyung.com
Jongwoo Cheon edited this article.