Hyundai sees recovery in Europe

Hyundai Motor Group Chairman Chung Mong-koo inspects the assembly line at Hyundai Motor's factory in Saint Petersburg, Russia, Tuesday.
/ Courtesy of Hyundai Motor Group

By Kim Tae-jong

Hyundai Motor Group Chairman Chung Mong-koo Tuesday demanded regional sales chiefs in Europe to prepare for post economic recovery across the region in advance by enhancing product quality and brand awareness.

"Despite the prolonged slump, the European market has started to show signs of recovery," Chung said to regional executives in Europe. "We should strengthen the reliability of our brand through high quality vehicles that can appeal to people here."

The remark came during a four-day trip to Russia and Europe from Monday to Thursday. He has already visited Hyundai Motor's Russia and Czech factories and Kia Motors' Slovakia plant, and plans to visit the group's regional headquarters in Frankfurt in order to be briefed on European sales strategy.

This is the first time for him to visit Europe this year. He visited Europe in March last year to urge heads of the group's branches there to find ways of minimizing any impact of the eurozone debt crisis.

During the trip to Europe this time, he stressed the importance of the European market, especially on how demands for vehicles from Hyundai and Kia were steadily increasing.

Automobile sales in the region dropped by 7.8 percent to record 12.52 million last year from 13.59 million the previous year, but Hyundai and Kia sold about 770,000, up from 11.6 percent from the previous year.

Total sales stood at 9.33 million as of September, 4.0 percent down from the same period last year, but the two Korean automakers showed only a 0.7 percent drop.

Chung also stressed Hyundai and Kia's vehicles are undervalued and the group should make efforts to upgrade their brand recognition in the market.

"Hyundai and Kia have been doing well here despite the economic downturn, but they haven't found a momentum for further growth due to weak brand recognition," the 75-year-old chairman said. "All the executives and employees here should make efforts to enhance product quality, develop an innovative brand image and diversify product lineups in order to leap forward."

As he inspected Kia's plant in Slovakia and Hyundai's factory in Czech, he stressed the importance of the two facilities, which have maintained full operation rates.

The Slovakian factory produced 235,000 vehicles including the Ceed, Venga and Sportage until the third quarter this year, while the Czech plant manufactured 228,000 vehicles including the i30, ix20 and ix35.

"Brand innovation should come not only from the product development stages but also manufacturing stages," Chung said. "It is necessary to maintain high production efficiency to supply products to meet customers' needs."

After the visit to the Czech plant, Chung also met with the nation's government officials including Industry and Trade Minister Jiri Cienciala.

Prior to the inspection of facilities in Europe, he visited Hyundai's factory in Russia and checked production and sales networks.

The factory has shown a 115 percent operation rate as of the end of the third quarter, producing 167,000 vehicles including Hyundai's Solaris and Kia's Rio,

85,757 of the Solaris and 67,678 of the Rio were sold as of September, making the two models the second-best and third-best selling vehicles in the country.

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