Speaker 1: Bloomberg Audio Studios, podcasts, radio news. Hyundai CEO Jose Muno
Speaker 1: spoke with Bloomberg Steven Engel in his first television interview
Speaker 1: since assuming this role at the world's third biggest automaker.
Speaker 1: They discussed what a second Trump presidency means for all automakers,
Speaker 1: as well as Hyundai's investments and strategy for growth in
Speaker 1: the US and China.
Speaker 2: What are your contingency plans in the United States though,
Speaker 2: because with the change of administration there to a Trump
Speaker 2: administration which is signaled that they're going to pull back
Speaker 2: on those tax credits. They perhaps you also lower some
Speaker 2: of the fuel efficiency standards as well. How do you
Speaker 2: play these changes from the Biden administration, which of course
Speaker 2: had those tax credits under the IRA.
Speaker 3: Our company took the decision to make a significant investment
Speaker 3: in the US during the previous Trump administration. We haven't
Speaker 3: invested in the US because of IRA or because of incident.
Speaker 3: This in general is not a good policy to just
Speaker 3: simply make an investment because of incentives, because they can
Speaker 3: come and go right. So, as such, we believe that
Speaker 3: the US market is the most important for US today
Speaker 3: and it's going to continue to be the most important
Speaker 3: in terms of not only the absolute but also the growth,
Speaker 3: and therefore investing and localizing is a good strategy. I
Speaker 3: think we are in a better place today than we
Speaker 3: were four or five years ago, simply because the investment
Speaker 3: gives us much more flexibility.
Speaker 2: How concerned are you though that the head of your
Speaker 2: chief competitor on the EV front, Elon Musk of Tesla,
Speaker 2: will have an outsized influence in the White House.
Speaker 4: I don't see that as a concern honestly.
Speaker 3: So if anything, I think having someone who is very
Speaker 3: close to the US industry and to the EV world,
Speaker 3: I think it should be positive for the industry because
Speaker 3: I think it's in his own interest and probably is
Speaker 3: in the interests of the country to trigger investments and growth,
Speaker 3: and also to ensure that we maintain competitiveness in our
Speaker 3: country visa v. Chinese and other competitors. Right, so, I
Speaker 3: think that's that is a positive.
Speaker 2: You're former senior executive at Nissan as an outsider, now
Speaker 2: as a competitor, that potentially that merger could upset you.
Speaker 2: Approve you from that third position as the largest OEM.
Speaker 2: What kind of threat would they merger between Honda and Nisa.
Speaker 3: B basically, you know, for us, being number three, being
Speaker 3: number four, being number two is not an objective a person.
Speaker 3: Our key objective is to provide to our customers with
Speaker 3: the best product, the best technology, which is safe, the
Speaker 3: best customer experience. The industry today is more competitive that
Speaker 3: has been in the past.
Speaker 4: Already. A few years back.
Speaker 3: There were a lot of talks and a lot of
Speaker 3: commory about consolidation as a one potential solution to maintain
Speaker 3: profitable operations. And if you look at the number of
Speaker 3: technologies that we have today and compared to five years ago,
Speaker 3: you have IV and you have much more hybrid, you
Speaker 3: have pluging hybrids, you have EiV, you have hydrogen. Well,
Speaker 3: it is really difficult for a single OEM.
Speaker 4: To be able to invest everywhere.
Speaker 3: So I think we need to be smart in where
Speaker 3: we invest our money. But at the same time, you
Speaker 3: cannot lose the opportunity to get access to the best
Speaker 3: available and future technology by just doing the things by yourself.
Speaker 3: So I think the concept of the ecosystem and the
Speaker 3: partnerships we will utilize in addition to the internal development
Speaker 3: of our own capabilities and technologies, I think we believe
Speaker 3: that this is the winning proposition, despite the fact that
Speaker 3: we are the third largest OEM.
Speaker 2: What's your strategy for the China market, because the legacy
Speaker 2: overseas carmakers are struggling, whether it's GM or others, they
Speaker 2: are losing money after seeing China as the cash cow.
Speaker 2: It's changed dynamic dramatically. You have a partnership with Baic Motor.
Speaker 2: I understand you're going to inject some one point one
Speaker 2: billion dollars into the China JV. Is this money well
Speaker 2: spent in a market that is losing market share? All
Speaker 2: the players are losing market share, the foreign carmakers, we.
Speaker 3: Have also been impacted very severely by the situation in
Speaker 3: the Chinese market, and at the moment we are trying
Speaker 3: to readjust our position in the market so we can
Speaker 3: make it a business unit which is profitable, which is
Speaker 3: worthwhile having. But let me tell you that being in
Speaker 3: China it's also a very good way to experience and
Speaker 3: to appreciate how to improve and also being humble looking
Speaker 3: at how competitors are operating in the market to do
Speaker 3: a better job right And then to me the fact
Speaker 3: that we are one of the audiences who have decided
Speaker 3: to state a course and invest and grow with our partner,
Speaker 3: which is a great partner, begin Auto.
Speaker 4: We have a very great relationship with.
Speaker 3: I think it shows our commitment to our customers in
Speaker 3: China and also in other markets.
Speaker 2: But can you leverage it as an export base at
Speaker 2: a time of threatened and realized terraffs?
Speaker 3: I think so, provided we get the right scale to
Speaker 3: be competitive, it could be for certain markets. But we
Speaker 3: also have to improve in the domestic market by having
Speaker 3: the right products that the Chinese consumers like, by having
Speaker 3: the right position in the right distribution, and definitely the
Speaker 3: competitiveness in terms of a price that the Chinese consumer
Speaker 3: is looking at.
Speaker 2: How can you compete against a company like BYD, which
Speaker 2: is vertically integrated. It i think makes its own batteries
Speaker 2: about eighty percent of its own batteries. It has the scale.
Speaker 2: I mean a lot of these car makers are not profitable,
Speaker 2: and that's a political issue as well. It's causing political
Speaker 2: waves abroad. But how do you compete on price and
Speaker 2: scale in a market that is dominated by the local players.
Speaker 4: Well, we are competing the facto.
Speaker 3: One thing is to compete, It depends on the market
Speaker 3: position and well thing is to compete in China itself
Speaker 3: where at the moment the local Chinese are doing a
Speaker 3: better job than basically anybody else in other markets fairly
Speaker 3: though nobody really knows. But we do our best within
Speaker 3: the rules always. But I would say in other markets
Speaker 3: like Europe, well we have them as a competitor and
Speaker 3: we do better than them. You go, for example Brazil
Speaker 3: Latin American markets, we just finished the year we became
Speaker 3: number four when the Chinese have sold more cars in
Speaker 3: Brazil than ever in the history. So we are the
Speaker 3: competing with them, and that they are not a shortcuts,
Speaker 3: They are not tricks that you can apply. So you
Speaker 3: need to be very consistent in terms of having the
Speaker 3: right economies of scale, having a good quality production capabilities
Speaker 3: at good cost.
Speaker 2: Let's talk about the local situation here right now. Obviously
Speaker 2: there's some political unrest here in South Korea with President
Speaker 2: un under fire has been impeached. There's a lot of
Speaker 2: political uncertainty right now in the presidential office. How is
Speaker 2: that potentially going to impact consumer sentiment and as well,
Speaker 2: it's hit the one quite a bit.
Speaker 3: First of all, well, I'm not in the politics in
Speaker 3: any market, and also not in Korea. We're watching carefully obviously,
Speaker 3: and then we're focusing on our business, where we have
Speaker 3: not seen any impact so far. We continue to focus
Speaker 3: on delivering the customer promise and then hopefully this will
Speaker 3: be clear very soon. Meanwhile, we focus in every single
Speaker 3: market doing our very best for our consumers.
Speaker 1: That was Hyundai CEO Jose Muno speaking with Bloomberg's Steven
Speaker 1: Engel