Hyundai Motor Chairman Chung Mong-Gyu was interviewed by Automotive News Europe reporters James B. Treece and Oles Gadacz at Hyundai headquarters in Seoul.
Will Korea's economic problems forced you to cut development programs or force you to cooperate with other makers?
Not at all. Some other carmakers have wanted to discuss cooperation with us, but we don't have any urgent need for discussions. Unlike other Korean automakers, we don't have any financial problems . . . We are in a much better position than other makers.
What are you doing to ensure that your quality is the best?
Our products have improved dramatically in the last few years. But there's a gap between the reality and the perception among general consumers.
Most of our advertising has focused on the short-term retail marketing strategy. But starting last year, we're placing a much greater emphasis on corporate image advertising.
If someone actually drives one of our cars, then they'll be able to say Hyundai cars have improved dramatically, so we're recommending that our dealers have more loaner cars. Especially with our dual dealers, we're recommending they make a Hyundai loaner available to all their customers coming in for service, even those coming in for service on a car from another franchise.
Any plans to lower export prices in view of the won devaluation?
Before the crisis, we had a won-dollar exchange rate of roughly 800 to the dollar. Today, it's around 1,600 . . . but this is not a normal exchange rate, so we can't adapt this exchange rate to our retail price. We expect the rate will go down slowly.
Anyway, it's very easy to reduce prices but very difficult to increase them, so I don't think we'll reduce retail prices dramatically.
How high can Korean sales in Europe go before the Europeans consider a quota?
We have no intention of increasing exports to Europe dramatically. We want to accommodate (the interests) of other automakers in the world, so we're not asking them to make too much of a sacrifice in their market share. I can't speak for other Korean automakers, but I don't think they want to aggravate European carmakers by hiking exports dramatically.
What will the Korean auto industry look like in one year?
I don't know if it will take one or two years, but there will be fewer carmakers than right now, and we'll be in a better position than right now.
The biggest competitive threat the Korean automakers have faced has not been from the Japanese, the Europeans or the Americans. The fiercest competition has been among Korean automakers. The intensity of that competition will be reduced.