CEO Interview: Hyundai Motor undergoing inner and outer changes to respond to challenges

[Photo by Hyundai Motor Co.]

Hyundai Motor Co. has turned around big this year – making strides on the EV front through its first byproduct from its ambitious self-developed EV platform E-GMP and upscaling in China via launch of luxury marque Genesis - timed with the global economy’s revival from a yearlong battle with the worst pandemic crisis in modern times.

Results have already shown as the Korean household carmaker delivered its five-year best income and record sales in the first three-month period.

“We have achieved in line with expectations in the first quarter, but how we do in the future is more important,” said Chang Jae-hoon, chief executive of Hyundai Motor, in an exclusive interview with Maeil Business Newspaper ahead of the earnings release on Thursday.

He cited chip shortage crisis and volatile conditions in foreign exchange and Covid-19 as headwinds in coming months.

“Since Covid-19 has triggered the chip shortage crisis, we cannot know when and what problem will pop up as the pandemic crisis is ongoing,” he said.

There had been expectations that car production could be disrupted from 900,000 to 1 million units in the first quarter, and the setback could last until the year-end and next year, he said.

“How we respond to the challenges would decide the capabilities of a finished carmaker,” he said.

“At such times of uncertainties, we must commit to business with new standards and strategy.” One upside from the experience with the unprecedented pandemic is that “we have gained ability to change faster,” he added.

A company can respond and advance faster if it keeps its business perspective on customers. “Voice of customer” will be the centerpiece of organizational reform, he said. Creativity and ingenuity or “thinking quality” is crucial.

Changes of within are already in the making.

“Young employees think differently. In the past, a corporate growth can lead to individual growth. But now, it can be the opposite,” he said, adding the management is studying how it can make performance-based compensations more fairly and transparently.

The union has also changed as once-militant unionized workers are more interested and knowledgeable in product quality.

The carmaker is committed to ESG (environment, social and governance) standards as a company negligeable in the area cannot be accepted at home and abroad. It will work will affiliates and supply partners to act their responsibility.

He prides Hyundai is among a few apart from Tesla and Volkswagen that can run EVs on exclusive platform, enabling variants optimized for each vehicle feature and customer needs.

Robotics is a sector the company is also keen on so that Hyundai can lead in logistics, delivery and robotics along with vehicle production.

He called for more aggressive government role in establishing infrastructure as fast-charging network is essential in backing proliferation of EVs. On fuel-cell vehicle, the entire hydrogen economy in energy, production, storage and transportation must progress hand in hand.

Hyundai Motor is testing out autonomous vehicle overseas and won’t rush until safety and reliability can be fully assured, he said.

In China, the Genesis launch could be a turning point, according to Chang who has been responsible for global operation of Genesis. “Hyundai Motor will pitch its strength in automation, high-end and hydrogen economy and make a rebound,” he said.

“Since everything has changed with the Covid-19, we cannot survive under past structure and organization. Hyundai Motor has its unique DNA to decide and act fast,” he said.

Promoted to the chief position in December, Chang has a proven track record as business manager and strategist. Prior to his roles at Hyundai Motor Group, he worked in the overseas business division of Calsonic Kansei, a consolidated subsidiary of Nissan Motor Company, for four years from 1992. In 1996, he joined Samsung Motors and Samsung Electronics in Korea, taking responsibility of business strategy and partnership projects. In 1999, he went back to Japan to work at General Electric’s plastic division as Asia SCM manager for five years.

He joined Hyundai Motor Group in 2011 as global business manager of Hyundai Glovis and moved to Hyundai Motor in 2012, where he held various positions in many areas including HR, sales and planning.

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