Speaker 1: Bloomberg Audio Studios, podcasts, radio news.
Speaker 2: Joining us is someone who has to chart the course
Speaker 2: amid a dynamic let's say, dynamic trade landscape. Hondai Motor
Speaker 2: CEO Jose Munios joins us here on set. Great to
Speaker 2: have you here. I know you're here for the New
Speaker 2: York Auto Show, so really appreciate you dropping by seven
Speaker 2: thirty one. Les, talk to me first about your cars.
Speaker 2: Very popular in the US. Your business has grown tremendously.
Speaker 2: You have Hyundai, you have Kia, you have Genesis, which
Speaker 2: Katie I do bought one of, and you produce a
Speaker 2: lot more cars than people would expect here in the
Speaker 2: United States.
Speaker 3: Yeah, you're right, So thank you much for having me
Speaker 3: so with supplaicit being that we do so, you're absolutely right.
Speaker 3: So we are now the third largest oem A globally.
Speaker 3: And then definitely it is not new, but for the
Speaker 3: last six years or so, we have come to the
Speaker 3: conclusion that the USA is the most important market for
Speaker 3: US globally and it's meant to continue to do so.
Speaker 3: So today we have factories in Alabama and in Georgia,
Speaker 3: and just three weeks ago we open a brand new
Speaker 3: factory in Savannah, Georgia to increase production by another five
Speaker 3: hundred thousand cars, so we produce about forty percent of
Speaker 3: the car that we sell in America here in America.
Speaker 3: And then we are with these five hundred thousand more cars,
Speaker 3: we're going to get to one point two million cars produced.
Speaker 3: This is a big undertaking.
Speaker 1: I do have one minor correction. I actually lease my Genesis.
Speaker 1: I didn't buy it, and okay, I kind of wish
Speaker 1: I had, because I'm worried about car prices rising, and
Speaker 1: you did promise that you wouldn't raise your prices through
Speaker 1: June second, and I'm curious. I'm not just asking for
Speaker 1: myself either, what happens after June second to that price pledge.
Speaker 3: Well, first and foremost, you know, as mentioned, we are
Speaker 3: very committed to this market. We announced just three weeks
Speaker 3: ago in the White House with our executive chair, Mister
Speaker 3: cho our big commitment to America with a twenty one
Speaker 3: billion dollar investment in this country in the next five years.
Speaker 3: So this means that we're going to increase capacity up
Speaker 3: to one point two million cars, but we are also
Speaker 3: going to increase everything that has to do with the
Speaker 3: supply chain to be able to produce those cars, including
Speaker 3: green and steel. So we're building a six billion a
Speaker 3: state of the art green steel factory. We call it
Speaker 3: the Electric ARCT Furness in Louisiana. And in addition to that,
Speaker 3: we are investing in new technologies like Boston Dynamics, bringing
Speaker 3: more chips to America with Nvidia, also in autonomous viving,
Speaker 3: with Emotional and even with ebitols supernal here. So this
Speaker 3: is really big. So thanks to those investments, we're able
Speaker 3: to produce cars like Juice I'm Glad you like it.
Speaker 3: DV seventy is the most popular Genesis, followed by the
Speaker 3: GB eighty and it's produced here in America in our
Speaker 3: plant in Alabama.
Speaker 4: So, as a company that has made bigger commitments twenty
Speaker 4: one billion through twenty twenty eight, this is another fourteen
Speaker 4: thousand direct jobs that you reported. What do you think
Speaker 4: more largely of the terror of posturing by the Trump administration.
Speaker 4: Do you think some of it is actually working to
Speaker 4: bring more factory jobs on shore in the United States,
Speaker 4: or do you think that there's a real risk here
Speaker 4: that a lot of component parts gets so expensive that
Speaker 4: it dwarts a lot of buying in this country.
Speaker 3: Well, in our case, we actually took the decision to
Speaker 3: invest in our new Savannah plant during the first Tramp administration.
Speaker 3: So you don't build a plant overnight, and you don't
Speaker 3: build plants thinking on incentives. So we took this decision
Speaker 3: some time ago, and then this came to fruition just
Speaker 3: three weeks ago, as mentioned, and then we don't look
Speaker 3: at things in the short Obviously we like free trade.
Speaker 3: We think in our global business because the components come
Speaker 3: from all over the world, free trade is the best
Speaker 3: for our business. But our commitment is such that we
Speaker 3: have to navigate through this situation. And in fact, when
Speaker 3: all these tariffs and uncertainty came to life, we wanted
Speaker 3: to reassure our customers that we would guarantee their prices.
Speaker 3: So that's why we came up with this the Handai
Speaker 3: Customer Assurance Program to ensure we will not increase prices
Speaker 3: during this period. Then after that we will evaluate the situation,
Speaker 3: but we will always focus on bringing the best product
Speaker 3: to the market with the highest safety rates. We're number
Speaker 3: one in America in terms of top safety Pick Plus,
Speaker 3: and then with the best quality and good features. And
Speaker 3: you have to always be competitive regardless of tariffs.
Speaker 2: Can I ask about the rest of your supply for
Speaker 2: the US market? I think about forty percent you make
Speaker 2: in the US, right, I'm pretty sure that you produce
Speaker 2: cars in Mexico for the rest of the world. And
Speaker 2: then we get a lot of South Korean imports from
Speaker 2: Hondaikia and Genesis. Is that? Am I doing the math correctly?
Speaker 2: And then how does that Korean supply look? Are you
Speaker 2: talking to the White House? Are you talking to South
Speaker 2: Korea about getting carve outs?
Speaker 3: Well, in our case, in the case of Handaid Motor Company,
Speaker 3: we produce in the US. We don't produce in Mexico.
Speaker 3: Really maybe very minor, but we took a concert decision
Speaker 3: to invest here in the USA. The other the rest
Speaker 3: of the production comes mainly from South Korea. Well, we
Speaker 3: are part of the ALIAS for Automotive Innovation. John Bosella,
Speaker 3: the President is representing the industry and it's conveying to
Speaker 3: the government the needs that we have in the industry,
Speaker 3: which are pretty much common across the board. And then
Speaker 3: we know that there are some discussions between the South
Speaker 3: Korean government and the White House. We are not actively
Speaker 3: part of that discussion. And then obviously I cannot reveal
Speaker 3: what they talk about. But definitely we all want to
Speaker 3: ensure that there is a a plain level field for
Speaker 3: everybody so that we can compete in good terms in
Speaker 3: the market, and we want to be competitive. I maintain
Speaker 3: this message for the consumer. We will be competitive and
Speaker 3: then the market will decide, depending on the supply and demand,
Speaker 3: if there's going to be some price increase or not.
Speaker 3: But again, we need to be competitive, right, So that's.
Speaker 1: What I was wondering. I mean, what does competitive mean?
Speaker 1: Does that mean you're eating the costs to keep your
Speaker 1: market share, you know, keeping your costs that consumers pay,
Speaker 1: car buyers pay, and willing to take the head or
Speaker 1: you know, how does that dynamic work?
Speaker 3: That dynamic is not different to the way it's being
Speaker 3: done over the last thirty years or so. It's simply
Speaker 3: in the short term and an additional burden to manage
Speaker 3: given all the implications of the of the supply. Again,
Speaker 3: our job is to focus on what we can control.
Speaker 3: The cause is something we can control. How we responding
Speaker 3: to the increase in tariffs, localizing investing mode in the
Speaker 3: country so that we don't get to be hit by tarifts.
Speaker 3: That's a simple solution and then on the revenue side,
Speaker 3: we'll have to see how the market reacts. If we
Speaker 3: have the opportunity to take maybe some reducing centives, increased
Speaker 3: price here there, we will do. But you're not going
Speaker 3: to see like a huge increase all of a sudden,
Speaker 3: or we are not planning to remove cards from the
Speaker 3: portfolio simply because of the tariffs, et cetera. Again, the
Speaker 3: most important is a good product, safe product, good quality,
Speaker 3: good features, and be competitive in the market. And then
Speaker 3: the rest is our job to try to optimize localizations.
Speaker 4: Honda I coo amazing coverage here because of course certainly
Speaker 4: very dynamic let's call it time in of sheriffs, and
Speaker 4: also the time for the New York Auto Show. I
Speaker 4: grew up going there every year of my life, so
Speaker 4: looking forward to seeing you there