Hyundai, Kia execs plan strategyExecutives of Hyundai Motor Group’s global branches mulled strategies for 2017 amid a weak global economy and shrinking car demand during annual year-end meetings.
Some 50 executives of Hyundai Motor and Kia Motors’ foreign branches held a marathon meeting from Thursday until Tuesday at the group’s Yangjae-dong headquarters in southern Seoul. Hyundai Motor Vice Chairman Chung Eui-sun and Kia Motors Vice Chairman Lee Hyoung-keun made appearance on Thursday, although group chairman Chung Mong-koo did not.
The executives of the nation’s top carmaker, the world’s fifth-largest, focused on shrinking car demand in North and Central American market due to rising interest rates in the United States, which will make installment purchases and leasing more expensive.
The automobile groups expects the size of the North America and Central America market to shrink 0.1 percent next year, removing the 0.1 percent growth it recorded this year.
The international car market as a whole will see 1 percent growth, the lowest since the global financial meltdown in 2008, the automaker anticipated.
Hyundai Motor Group is looking at demand in China, the world’s largest auto market, which showed 15.5 percent growth this year.
Chinese’s market was helped by a lowering of the sales tax from 10 percent to 5 percent. However, the tax will temporarily jump next year to 7.5 percent for small-engine car purchases, which may negatively impact demand and limit growth in the market to 4.4 percent.
Diverse scenarios for a possible renegotiation of the North American Free Trade Accord by the Donald Trump administration in the U.S. were another topic.
Hyundai Motor Group spokesman said this year’s meeting featured an open discussion format. Prior to 2014, the meeting followed a more conservative and hierarchical format in which the president of each overseas branch gave a one-way briefing to the chairman.
Meanwhile, the domestic auto market was expected to record negative growth for the second consecutive year. The market will shrink 3.5 percent next year, following 0.7 percent negative growth this year.
Hyundai Motor Group is looking to emerging markets such as India, which is expected to grow by 6.2 percent, and the ASEAN region, which will see 7.6 percent growth next year.
Hyundai Motor Group will release the Creta model in Russia and India next year. They will release Hyundai’s ix25 (the local name for the Creta) and Kia’s KX3, both of which are SUV models, in the Chinese market next year.
BY JIN EUN-SOO [firstname.lastname@example.org]