Jeong Eui-sun, Executive Vice Chairman, "Achieving Visible Results in Future Businesses This Year... Investing 100 Trillion Won Over 5 Years" (Comprehensive)

New Year's Meeting for 2020 Held at Hyundai Motor Yangjae Headquarters on the 2nd
Jung Eui-sun: "Starting This Year, Achieving Tangible Results in Future Fields"
Emphasizing Technological Innovation, Organizational Culture Innovation, and Customer Priority Goals
"Investing 20 Trillion Won Annually, Totaling 100 Trillion Won Over the Next 5 Years"

Hyundai Kia Motors Yangjae Headquarters

[Asia Economy Reporter Kim Ji-hee] Chung Eui-sun, Executive Vice Chairman of Hyundai Motor Group, expressed his ambition on the 2nd at the 2020 New Year's meeting held at the headquarters in Yangjae-dong, Seoul, to make this year the inaugural year for securing future market leadership. To this end, the group plans to continue investing 20 trillion won annually, aiming to invest more than 100 trillion won over the next five years.

At the event, Executive Vice Chairman Chung stated in his New Year's message, "Hyundai Motor Group intends to make 2020 the inaugural year for securing leadership in future markets," showing his determination to achieve tangible results in future business sectors starting this year.

At the meeting, Executive Vice Chairman Chung emphasized goals such as ▲technological innovation ▲business foundation innovation ▲organizational culture innovation ▲customer-first priority. He said, "If all employees unite and continuously innovate technology, business, and organizational capabilities, we will wisely overcome difficult environments and challenges and become a company more trusted by customers." He also expressed his ambition to visualize future market leadership in electrification, autonomous driving, and mobility services while promoting overall business structural improvements.

In particular, the New Year's meeting shared Hyundai Motor Group's changes and achievements over the past year. Through videos, employees unanimously agreed that corporate culture changes made last year, such as flexible working hours, simplified titles, and relaxed dress codes, led to improved working environments. There was also a session sharing key achievements in 2019, including autonomous driving and leading the hydrogen society. Hyundai Motor Group introduced mobile real-time live streaming to enable employees to participate and communicate more freely.

This New Year's meeting was held in a more relaxed atmosphere than in the past, reflecting Hyundai Motor Group's changed corporate culture. Executive Vice Chairman Chung even joked with employees during his approximately 10-minute New Year's speech. Wearing a gray suit and a blue-toned tie, he said, "After the group New Year's meeting, there is a Chamber of Commerce New Year's meeting, so I wore a tie. You are dressed for your purposes, and I am dressed for mine, so don't worry," leading a comfortable atmosphere.

◆ Operating 44 electrified vehicles by 2025... Visualizing future market leadership= Regarding Hyundai Motor Group's technological innovation direction, Executive Vice Chairman Chung began, "With the development of technology and networks, the imagined future is becoming reality, and such changes are accelerating in the automotive industry." The group's technological innovation direction can be summarized as solidifying leadership in the electrification market, leading the expansion of the hydrogen industry ecosystem, commercializing autonomous vehicles, and gradually expanding the mobility service business.

He continued, "To firmly establish leadership in the electrification market, based on the development of dedicated platforms and strengthening competitiveness of core electrification components, we plan to operate a total of 44 electrified vehicles, including 11 dedicated electric vehicle models, by 2025," he declared.

Having sold 24 types of electrified vehicles last year, Hyundai Motor Group will expand to a total of 44 models by 2025, including 13 hybrid models, 6 plug-in hybrids, 23 electric vehicles, and 2 hydrogen electric vehicles. In particular, electric vehicles will increase from 9 models in 2019 to 23 models by 2025, starting with the launch of dedicated models in early 2021. A new electric vehicle architecture (basic vehicle framework) development system will also be introduced and first applied to models released in 2024.

In 2019, Hyundai Motor Group signed a supply agreement for hydrogen fuel cell systems in the North American commercial vehicle market with Cummins Inc., a global leader in engines and generators based in the U.S. This year, Hyundai Motor Group will begin exports to the U.S. through system supply to Cummins and expand to Europe and other regions. In the future, hydrogen fuel cell systems will be supplied to finished vehicle manufacturers, ships, railroads, forklifts, and power generation and storage sectors, aiming to sell about 200,000 hydrogen fuel cell systems annually domestically and internationally by 2030. A production system capable of producing 500,000 hydrogen electric vehicles annually will also be established domestically.

In the autonomous driving sector, Hyundai Motor Group plans to secure technology through a joint venture with Aptiv in the U.S. and push for commercialization development in 2023. After developing an autonomous driving platform in 2022, limited operation in certain areas will begin in 2023, with full-scale mass production targeted for the second half of 2024. Executive Vice Chairman Chung said about the mobility sector, "We will establish corporations in major regions such as the U.S., Europe, and Asia, and from this year, actively execute business, expanding step by step."

New technology development and businesses such as robotics, personal aerial vehicles (PAV), urban air mobility, and smart cities will also be actively pursued. In particular, PAV will be integrated with service platforms and developed into an urban air mobility (UAM) business.

◆ Fundamental cost innovation through new technologies and overall business structural improvement= Business foundation innovation is also a key task this year. Executive Vice Chairman Chung said, "We will eliminate unnecessary waste and promote more fundamental cost innovation activities through new ideas and technology development."

By developing a new electric vehicle architecture system, cost structures of electric vehicles will be innovated through parts standardization and multi-model application, and lineup efficiency will be improved to increase volume and profitability per model. Sales network optimization and new sales methods will be introduced, and flexible global production systems matching market demand will be secured.

Regarding the finished vehicle business, he emphasized, "Based on regional responsibility management, we must establish a profitability-centered business operation system, and the headquarters division should actively support this." Hyundai Motor Group established a global regional headquarters system last year and strengthened autonomous and responsible management by region. The plan is to enhance business competitiveness centered on regional headquarters and secure execution capabilities for future businesses, thereby strengthening profitability and laying the foundation for future businesses.

◆ Creative thinking like a 'startup entrepreneur'= Regarding organizational culture innovation, Executive Vice Chairman Chung said, "I hope each and every one of you acts not as a mere member of a large organization but with the mindset of a startup entrepreneur, engaging in creative thinking and challenging execution." He added, "I will lead by example, expanding horizontal communication with you and establishing an organizational culture where diverse individuality and capabilities harmonize."

Since last year, Hyundai Motor Group has been promoting organizational culture and system improvements to create an autonomous and horizontal culture centered on work by expanding 'autonomy' and 'opportunities.' Individual autonomy has been greatly expanded through flexible working hours and autonomy in dress code and lunch breaks. New personnel systems, such as reducing and integrating rank and title systems, are also being implemented. The general employee rank system has been reduced to four levels, and titles simplified to 'Manager' and 'Senior Manager.' The promotion seniority system has been abolished to provide a foundation for talented individuals with capabilities and expertise to grow early.

◆ Best efforts to maximize customer satisfaction and shareholder value= Finally, Executive Vice Chairman Chung once again emphasized 'customers' on this day. He said, "More important than the company's growth is the happiness of customers who use our products and services," and "Our corporate activities must start from customers, and we must create new value together with customers."

He added, "We will listen carefully to the voices of various stakeholders, including investors, and actively reflect them in management activities to do our best to maximize shareholder value." Last year, Hyundai Motor held 'CEO Investor Day' twice, inviting domestic and international institutional investors and analysts. At the CEO Investor Day held in December, Hyundai Motor announced its mid- to long-term innovation plan, the '2025 Strategy.'

This content was produced with the assistance of AI translation services.