WEBVTT - Hyundai President José Muñoz Talks US Investment

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<v Speaker 1>Bloomberg Audio Studios, podcasts, radio news.

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<v Speaker 2>Hyundai the automaker, is investing billions of dollars in US production,

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<v Speaker 2>including it's Georgia EV hub, and looking to expand into

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<v Speaker 2>pickup trucks and big SUV's, core US segments that have

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<v Speaker 2>long been dominated by Ford, GM and Toyota. Joining us

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<v Speaker 2>now at the desk is Hondai's CEO, Jose Munios. He's

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<v Speaker 2>here for the New York Auto Show, and Jose appreciate

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<v Speaker 2>you joining us.

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<v Speaker 3>I was at the Auto Show yesterday.

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<v Speaker 2>I got to see the Boulder, which is your concept

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<v Speaker 2>large SUV looks fantastic, and I had thought, you know,

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<v Speaker 2>it must be so difficult to come in and compete

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<v Speaker 2>in this space because the US automakers have long dominated

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<v Speaker 2>because of the Chicken tax. But you'll be building I

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<v Speaker 2>guess if you do go that direction, you'll be building

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<v Speaker 2>it here.

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<v Speaker 3>That is the plan.

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<v Speaker 4>Thank you for having me, Matt always supplicit to visit

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<v Speaker 4>you well. As you know, we have made a big

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<v Speaker 4>comitment to invest twenty six billion dollars in the next

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<v Speaker 4>four years. And this is after twenty zero point four

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<v Speaker 4>billion dollars that we have invested in the last four

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<v Speaker 4>years that we've been in the country that we celebrated

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<v Speaker 4>last year. As part of this commitment, we want to

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<v Speaker 4>increase our capacity in the US to one point two

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<v Speaker 4>million from eight hundred to nine hundred thousand today, and

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<v Speaker 4>then we want to increase our supply chain, including a

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<v Speaker 4>steel meal in Louisiana, and then additional investments in technology

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<v Speaker 4>like robotics, AI, data centers, so on and so forth.

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<v Speaker 4>But the most important that we have announced during the

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<v Speaker 4>New York Show last week is that we're going to

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<v Speaker 4>introduce in the market fifty eight new products. Thirty six

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<v Speaker 4>are going to be one hundred products, and twenty two

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<v Speaker 4>they're going to be Genesis and then through the next

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<v Speaker 4>four years. And then the most important for us was

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<v Speaker 4>the introduction of the Boulder concept because when you look

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<v Speaker 4>at the behavior and the performance of the brand in America,

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<v Speaker 4>I think we do pretty much a good job. So

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<v Speaker 4>we just ended Q one with an all time record.

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<v Speaker 4>We had the twenty twenty five over achieving one million

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<v Speaker 4>wholesales for the first time ever, and we're thinking how

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<v Speaker 4>we can continue to grow and link this to our

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<v Speaker 4>commitment to America for America, and we thought that the

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<v Speaker 4>only segments where we are not competing today.

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<v Speaker 3>Are the Body on frame.

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<v Speaker 4>We got a fantastic review by the press, so thank

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<v Speaker 4>you Matt. Everybody loved the designs. I can tell you

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<v Speaker 4>that the reality is going to be better than that.

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<v Speaker 4>Our designers never disappointed us.

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<v Speaker 2>I will tell viewers who don't know. Body on frame

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<v Speaker 2>means it's a much more robust vehicle. That's a truck

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<v Speaker 2>right as opposed to the unibody cars.

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<v Speaker 3>And you need that in.

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<v Speaker 2>This region because of the potholes and broken down roads

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<v Speaker 2>that take a beating. But it's one that has long

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<v Speaker 2>been dominated by US players because of this tax. We

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<v Speaker 2>have a twenty five percent tariff on light duty trucks

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<v Speaker 2>built overseas that come in here. Where would you build

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<v Speaker 2>such a body on frame vehicle?

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<v Speaker 3>Definitely here in America.

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<v Speaker 4>These would be part of our strategy to be localized,

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<v Speaker 4>to be vertically integrated, part of the twenty six billion dollars,

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<v Speaker 4>So we want to make it here with our supplier

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<v Speaker 4>base and then to the taste of the American consumer.

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<v Speaker 1>These, though, I mean, are very long term plans that

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<v Speaker 1>you've put in place, so I'm assuming short term fluctuations

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<v Speaker 1>and consumer behavior isn't going to change that. But are

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<v Speaker 1>you seeing changes in consumer behavior now having to deal

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<v Speaker 1>here in the US with gasoline above four dollars a barrel.

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<v Speaker 3>Yeah, we see that all the time.

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<v Speaker 4>So our strategy is being different to other OEMs in

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<v Speaker 4>the sense that we want to offer the customers what

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<v Speaker 4>they want when they want it, and as such we

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<v Speaker 4>not only invest on evs but also on hybrid We're

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<v Speaker 4>going to start producing hybrids this year in our hm

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<v Speaker 4>A plant in Savannah, and we have also announced that

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<v Speaker 4>we will introduce er EV extended range EVS next year

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<v Speaker 4>in the country as well.

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<v Speaker 3>So that's how.

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<v Speaker 4>We came to the conclusion that you know, if consumers

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<v Speaker 4>want more evs, we have to produce more evs. They

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<v Speaker 4>want more hybrids, we have to produce more more hybrids.

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<v Speaker 4>If they want, for example, both the type of vehicles,

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<v Speaker 4>we will. But to your question, we have seen a

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<v Speaker 4>significant change in the dynamics. So for example, in the

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<v Speaker 4>month of March, we've seen an increase of EV sales

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<v Speaker 4>of about forty percent compared to February. So definitely, when

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<v Speaker 4>the American consumer sees an increase in fuel prices, they

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<v Speaker 4>try to move to solutions which are more friendly in

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<v Speaker 4>terms of costs right, especially in states like California.

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<v Speaker 2>We saw today that this administration isn't going to give

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<v Speaker 2>any help on aluminum and steel tariffs to automakers that

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<v Speaker 2>produce here. Are you penalized to some extent for producing

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<v Speaker 2>a car here because if you made it in Korea,

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<v Speaker 2>you might get just a fifteen percent flat tax.

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<v Speaker 3>And when you build a car here.

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<v Speaker 2>You got to pay the fifty percent on aluminum, fifty

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<v Speaker 2>percent teriffs on steel, You got to pay the tariffs

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<v Speaker 2>on all of the components that come together. And Ford

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<v Speaker 2>says they end up actually paying more to build a

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<v Speaker 2>comparable vehicle than you do when you make it in

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<v Speaker 2>South Korea.

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<v Speaker 4>Well, that's a very good point that that's why in

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<v Speaker 4>our case the strata is very simple localization. And that's

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<v Speaker 4>why we are going to produce this boulder with steel

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<v Speaker 4>made in America, so full integration, the steel, the logistics,

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<v Speaker 4>the components, the manufacturing, the workers. Everything is going to

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<v Speaker 4>be made in America, including the steel.

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<v Speaker 2>I have to ask you about Magma, which is your

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<v Speaker 2>answer to AMG or BMW's m I saw the wing

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<v Speaker 2>back concept yesterday, which was fantastic. I know you're going

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<v Speaker 2>to race at Lamar, which is increasingly becoming like the

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<v Speaker 2>Davos of car manufacturers. Can you really compete against BMW?

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<v Speaker 2>Can you compete against Mercedes? Can you compete against Audi

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<v Speaker 2>with that vehicle here, with that brand here.

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<v Speaker 3>In America without a doubt.

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<v Speaker 4>So last year we saw an old time breaker eighty

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<v Speaker 4>two thousand Genesis in this market, and then last year

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<v Speaker 4>we also achieved our one millions Genesis sales, so we've

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<v Speaker 4>been the fastest growing luxury OEM globally because we did

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<v Speaker 4>that in only nine years and six months, so faster

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<v Speaker 4>than Tesla, faster than other luxury competitors, and definitely as

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<v Speaker 4>part of the evolution as a next frontier for our

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<v Speaker 4>luxury brand, we wanted to get into the competition, so

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<v Speaker 4>the War Endurance Championship, so you have an open invitation

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<v Speaker 4>to be able to join us in in Leman, and then.

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<v Speaker 3>It needs to be real.

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<v Speaker 4>That's why we came up with the Macmam Orange and

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<v Speaker 4>the Macmac concept, which if you saw the numbers, a

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<v Speaker 4>GV sixty gives you a standard mode more than six

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<v Speaker 4>hundred horsepower, but if you push the boost model, so

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<v Speaker 4>you're gonna get to six hundred and fifty horsepower for

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<v Speaker 4>about fifteen seconds. So this is the Bloomberg Boost or

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<v Speaker 4>the Matt Bust in July three point four seconds to

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<v Speaker 4>make it two one hundred miles?

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<v Speaker 3>Is that one next?

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<v Speaker 4>That's upon next, so you can you can try. So

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<v Speaker 4>we're gonna be credible contender and it's going to be

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<v Speaker 4>real performing all right.

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<v Speaker 3>Jose, great having it here.

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<v Speaker 2>Thanks so much for joining us, and I look forward

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<v Speaker 2>to seeing you on the track at Lamont as well.

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<v Speaker 2>Jose Munios there the CEO of Hyundai and Genesis.

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<v Speaker 3>Be sure to listen to Hot Pursuit.

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<v Speaker 2>By the way, that's my autos podcast with Hannah Elliott.

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<v Speaker 2>And you saw some of the video of me there

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<v Speaker 2>at the car show with Christina Christina Raffini, because Bloomberg

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<v Speaker 2>this weekend is going to show a big piece about

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<v Speaker 2>what we saw and did at the New York International

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<v Speaker 2>Auto Show and it was a lot of fun.