Maintains Strong Showing
Abroad
Hyundai Automotive Group sets sights on 100 trillion won in sales

Hyundai Automotive Group has come up with massive investments in Korea and abroad and aggressive marketing plans with the goal of surpassing 100 trillion won in sales during 2006. If Hyundai Automotive Group achieves this year's target sales, the group will become the second to rake in more than 100 trillion won in sales following Samsung Business Group.
Hyundai Automotive Group Chairman Chung Mong-koo called for aggressive investment and marketing strategies to establish a foundation for becoming a world-class corporation in his speech during a ceremony for launching the 2006 business, held at the group headquarters in Yangjae-dong, Seoul on January 2. He disclosed the 2006 business plan to post 100 trillion won, a 17.6 percent surge from last year. The plan calls for selling 4.12 million units worth 63 trillion won in Korea and abroad while investing 8.54 trillion won, a 29.6 percent jump from 2005. The target investments breaks down to 3.3 trillion won in R&D outlays for securing future competitiveness and 5.24 trillion won in facility investments for building up global production centers in the United States, China and Europe.
The year 2005 was a stellar year for Hyundai Motor and Kia Motors which posted a combined 85 trillion won in sales, up 13.5 percent over the previous year by selling 3.55 million units, an 11.9 increase from 3.17 million units in 2004.
Hyundai Automotive Chairman Chung said, "Last year was a watershed in global management by successfully dedicating the United States plant in Alabama and launching automobile production there."He praised his executives and staff for their achievements in exports by tiding over such economic difficulties as domestic demand slump: the automotive group posted a combined $3.17 billion exports; Kia Motor won the $10 billion Export Tower; and Hyundai Mobis grabbed the $3 billion Export Tower.
Chung emphasized that Hyundai Automotive Group will push for improving technology and quality levels of steel plates for automotive production and core parts and building up a stable supply of parts and materials, which he said determine the competitive edge of manufactured car units. He added that his group will accelerate its efforts to ensure vertically integration of automobile manufacturing ranging from materials to such parts as modules, electronics and power trains.
He appealed for his executives and staff to overcome internal and external difficulties with a more creative and pioneering spirit, not resting on the past success, saying that few management conditions for the year 2006, including raw materials prices, personnel expense hikes and foreign currency exchange rates are favorable.
Chairman Chung expounded four management strategies - a focus on substantial growth in such areas as technology, quality, design and excellent manpower development and profits; coping with global competition squarely with the establishment of a regime for supporting global management; showing solidarity in overcoming external management conditions by rapidly responding to an emergency by arming executives and staff members with crisis management capability; and ensuring a transparent, ethical management to justify its existence as a corporate entity and perform duties as a responsible member of society.
Hyundai Automotive Group last year launched the mid- and long-term global management vision under the catchphrase "Innovation for Humanity."The group decided to accelerate its push for upgrading its product quality to the world's best in a bid to strive for achieving a qualitative and quantitative growth as a global corporation in earnest from this year.
The group registered a steady growth as it raised its sales to 85 trillion won up 13.3 percent from 75 trillion won in 2004 and its sales in the automobile division rose 52 trillion won up 6.1 percent last year from 49 trillion won in 2004.
The steady growth the group has made despite unfavorable management circumstances comes from the expansion of its car portfolio from such big-ticket passenger cars as Sonatas and Grandeurs to value-added Santa Fes, Sorentos and Carnivals. Hyundai Motor witnessed its brand soar dramatically, as the automaker was put on a list of top 100 automobile companies announced by U.S. magazine BusinessWeek for this year. The achievement was attributable to a rise in customer trust toward the quality of Hyundai Motor and Kia Motors cars, industry analysts said.
The group strives for becoming a world-class corporation as it is aggressively pushing ahead with a localization strategy to explore overseas markets by capitalizing on stable production and distribution foundation in Korea to tide over trade barriers while conducting offensive marketing activities by developing cars tailored to satisfy the tastes of diverse consumers across the world.
During 2006, the group plans to boost domestic car selling and exports through the effective operation of domestic production facilities and to expand overseas production centers in the United States, China and Europe. The group is intent on the full-fledged operation of the Alabama plant and the raising of the production capacity of the existing ones in China. It is building a plant in Slovakia that will churn out cars for Kia Motors and will break ground for a second plant in China for Hyundai Motor and another one in Eastern Europe.
Hyundai Automotive Group plans to launch the new Avante, Terracan model and Carens models, Sonata diesel and Grandeur diesel, Verna/ and Pride environment-friendly hybrid cars and employ an aggressive marketing strategy to stoke up domestic demand and make efforts to keep a record high of exports the group has made last year by raising the brand value based on quality in overseas markets.
As part of its efforts to beef up its capabilities as a global automobile group, the group will pursue a human-oriented management philosophy. To this end, its executives and staff members will be urged to perform their duties and show an attitude with a responsible manner in consideration of the great contribution the automobile industry makes to economic development; promote co-prosperity relationships with numerous subcontractors and related companies; strive for becoming a globally-renowned corporation with an excellent competitive edge and the value of world-class standards and performances; and brace for fundamental changes in the automobile industry for the future in the wake of environmental conservation efforts and the depletion of natural resources.
Recognizing the necessity to raise expertise manpower with a view to making the automobile industry globally competitive, the group has implemented a scholarship program for excellent engineering college students since 2003. The group plans to promote such a program as a next-generation long-term project.
Meanwhile, Hyundai Motor disclosed a more detailed and ambitious business plan during a business explanation session held at the Korea Exchange in Yeouido, Seoul on January 10, calling for raking in 41.4 trillion won in sales by selling 630,000 units domestically and exporting 1,137,000 units plus 922,000 from overseas production lines abroad. The target domestic sale and export figures represent a 10.6 percent and a 0.5 percent rise over the 2005 estimates. The company has raised target sales of its overseas production lines by a whopping 44.9 percent.
Take a look into target sales by area. Domestic automobile production lines accounted for 30 trillion won or 9.7 percent while foreign ones took up 11.4 trillion won or 51.6 percent.
In this regard, Hyundai Motor plans to set aside 3.4 trillion won for R&D and facility expansion. The company will employ an aggressive management strategy in foreign markets to launch new cars in succession and expand a dealership network. nw

Hyundai Automotive Group Chairman Chung Mong-koo gives a message during a ceremony for starting the 2006 business year at the group's head office in Seoul on January 2.