The heir apparent of Hyundai Motor Group said on Wednesday he will complete a restructuring in 2019 as he moves to formally take over from his father at the helm of South Korea’s second-biggest conglomerate.
Euisun Chung made the comments in his first New Year address to employees in the absence of his 80-year-old father, the clearest sign that he is now in charge of the group as it plans its first leadership transition in about two decades.
The transition comes at a difficult time for the group as Hyundai struggles with an extended sales slowdown in the United States and China, a US recall probe, sharp technological change and potential US tariffs.
“Business uncertainties are heightening as the global economy continues to falter. Walls of protectionism are being constructed around the world,” Chung, 48, told hundreds of employees at the group’s headquarters in Seoul. “Internally, we face challenging tasks such as stabilising business in major markets like the US and China, while simultaneously enhancing our responsiveness to drive future growth.”
Group companies Hyundai Motor Co and Kia Motors Corp earlier announced a “conservative target” of 7.6 million vehicle sales in 2019 as they battle to recover market share in China and the United States.
The target compared with an estimated 7.3 million to 7.4 million vehicle sales last year, the auto conglomerate said, citing analysts’ estimates. The pair will announce 2018 sales results later on Wednesday.
Analysts said 2018 was likely the fourth consecutive year the pair had missed their annual sales target, as their latest sport utility vehicles failed to gain traction in China and the United States, the world’s two biggest auto markets.
Hyundai Motor and Kia Motors will launch a combined 13 new or face-lifted models this year, including a premium Genesis SUV, Chung said.
Hyundai also would launch a pilot service of its autonomous robo-taxi in South Korea by 2021 and explore partnerships with global industry leaders to develop autonomous driving technologies. The group aimed to sell 1.67 million eco-friendly vehicles involving 44 models annually by 2025.
Chung was promoted in September to Executive Vice Chairman of the conglomerate founded by his grandfather in 1967, bringing him a step closer to taking over from his father, Mong-Koo Chung, and easing concern about a leadership vacuum.
In his New Year’s comments, he pledged to “actively communicate with” shareholders and enhance shareholder value, an apparent reference to US hedge fund Elliott which effectively scuttled a previous restructuring plan last year.