Hyundai Motor Group Executive Chair Advocates ‘Trust by Taking on Challenges and Making a New Leap Through Change’ in New Year’s Message

SEOUL, January 3, 2023 – Hyundai Motor Group held a New Year town hall meeting today at its Namyang R&D Center attended by executives and employees of Hyundai Motor Company and Kia Corporation.

In their first face-to-face New Year meeting in three years, Euisun Chung, Executive Chair of Hyundai Motor Group met with employees to share their New Year's messages and deliver strategic direction and vision for 2023. Jaehoon Chang, President and CEO of Hyundai Motor Company, Ho Sung Song, President and CEO of Kia Corporation, President Chung Kook Park, Head of Hyundai-Kia’s R&D Division, and Chang Song, President and Head of Transportation-as-a-Service (TaaS) and Vehicle SW Tech Unit at Hyundai Motor Group also joined the meeting. The executives actively engaged in communication while responding to employees’ questions.

"We will not fear risks and only be reactive to changes. Instead, we will lead the future by being one step ahead and create opportunities out of crises,” Executive Chair Chung highlighted during the meeting. “To this end, 2023 will be the year we establish ‘trust by taking on challenges and making a new leap through change’ to overcome the difficult business environment and move forward together toward a better future."

Preempting its continued leadership in the era of innovation in 2023, Hyundai Motor Group presented ‘trust through challenge and stability through change’ as a key topic and a new standard for the group.

This year’s meeting venue and town hall setting also reflect the Group leadership’s will for taking on challenges and change. The Namyang R&D Center is the hub for Hyundai-Kia’s key R&D activities, where the development of vehicles and proprietary technologies for engines and powertrain takes place. The center is now becoming the backbone of the Group's technology, driving quality-based innovation and transformation for the future.

The interactive town hall setting provided a stage for the Group’s key executives to explain the strategies for 2023, allowing them to actively engage with employees. Jaehoon Chang, President and CEO of Hyundai Motor and Ho Sung Song of Kia President and CEO, each elaborated on the companies’ business strategy and directions. Chung Kook Park, President and Head of Hyundai-Kia R&D Center provided the vision for research and development while Chang Song, Head of TaaS Division, presented the vision for Software Defined Vehicles (SDV).

"We must overcome the status quo and create a corporate culture that is proactive and ever-changing,” added Executive Chair Chung, emphasizing the need for proactive change.

Following the town hall meeting, Mr. Chung stayed at the Namyang R&D center, spending further time with employees to discuss various topics.

Establishing 'trust’ by taking on challenges ⋯ Constantly embarking on challenges for electrification, software, and new businesses

Executive Chair Chung opened his New Year remarks by expressing: “We are nearing the end of this long tunnel of COVID-19. So, it’s great to be here in person to kick off the New Year at the Namyang R&D Center, the heart of our innovation and where we take on challenges.

“The impact of COVID-19 is far and wide, with increased interest rates, inflation, and fluctuation in exchange rates. There are also ongoing geopolitical risks. All these factors are leading to greater economic uncertainty,” he added.

Mr. Chung said employees should pursue establishing trust by taking on challenges and ensuring stability by achieving change as a means to overcome business uncertainties and create a better future. He affirmed that the Group is committed to building trust by taking on challenges in diverse areas, including electrification, software and new businesses. He added that the Group will be a first mover to lead markets by securing top talent and sparing no effort to develop new technologies in a wide range of innovation.

On electrification, the Executive Chair expressed: “Last year, two cars that use our dedicated full electric vehicle platform E-GMP – the IONIQ 5 and EV6 were named ‘World Car of the Year’ and ‘European Car of the Year’ respectively and were among the top 5 EVs sold globally, demonstrating a successful start to our transition to electrification.”

Executive Chair Chung continued: “In 2023, we will continue to develop and provide innovative vehicles to solidify our leadership position in the global EV market and continue the shift to electrification.”

The Group plans to launch various EV models this year, ranging from light to flagship, such as Kia’s EV9 electric SUV as well as Ray EV and Hyundai Kona EV to expand opportunities for providing diverse EV experiences to customers while strengthening the Group’s top-tier position in the global EV market.

Mr. Chung also accentuated the importance of software. “Company systems, including R&D, must be upgraded to achieve a ‘software-centered transition.’ This will enable us to secure the capability to produce flawless Software Defined Vehicles (SDV) and take the lead among the global competition."

This encapsulates the strategic effort of the Group to offer comfortable freedom of movement and innovative user experiences to customers by transforming all models into SDVs by 2025.

Hyundai-Kia will apply the Over-The-Air (OTA) software updates function to all models sold in the global market by 2025 and provide personalized services, such as software updates and subscriptions. By establishing a data platform, the Group will connect, and process various data generated throughout the car's life cycle to provide continuous innovative services.

Executive Chair also specified plans for new business areas, including autonomous driving, future mobility, robotics, energy, and new materials to secure future growth engines for the Group.

“In autonomous driving technology, we are planning to launch models capable of autonomous driving Level 3 on highways in Korea. We’re also planning to commercialize robotaxis with autonomous driving Level 4 in North America," said Mr. Chung.

In the first half of the year, the Group will introduce Genesis luxury brand G90 and Kia EV9 equipped with Highway Driving Pilot (HDP) feature. This Level 3 capability on highways and vehicle-only roads is the first step towards fully autonomous driving, where drivers take control of the vehicle only in emergency situations.

In addition, through Motional, the Group’s autonomous driving technology JV with Aptiv, it will cooperate with car-sharing companies, including Uber in the U.S. to commercialize Level 4 IONIQ 5 robotaxis that operates without driver engagement.

Speaking further on the future of mobility, Mr. Chung commented: “In the area of future mobility, we will bring to market Purpose Built Vehicles (PBV) that meet the mobility needs of people and things. We will also develop a prototype vehicle for Advanced Air Mobility (AAM) and reinforce our leadership position as a Mobility Service Provider.”

Having launched the PBV Niro Plus of Kia last year, Hyundai Motor Group plans to further expand the number of PBV models this year and launch a dedicated PBV model based on a skateboard platform by 2025. The Group is also accelerating the development of AAM vehicles by signing MOUs with major partners such as Rolls-Royce and Safran.

Mr. Chung also elaborated on the Group’s ambitions in the field of robotics. "We will strengthen cooperation among the Robotics Lab, Boston Dynamics, and BD-AI Institute to complete the value chain to provide a human-friendly product that supports the well-being and convenience of humanity."

Hyundai Motor Group established the Boston Dynamics AI Institute last year with plans to focus on securing high-level AI capabilities to create synergies in various future new business areas, including robotics.

“We will also expand to new energy areas such as Small Modular Reactors (SMRs) and foster development of safer, super high-strength steel products as well as smarter logistics solutions to continue to secure future growth engines for the Group,” Executive Chair Chung added.

The Group is actively entering new energy business areas such as hydrogen production and electric power trading brokerage and SMRs, and is also accelerating the development of high-strength steel products and new materials for future mobility.

Establishing stronger trust through the results of taking on challenges ⋯ building trust with  customers, society and Group members

Mr. Chung reiterated: “We must take on challenges based on trust, and the positive results must lead to even stronger trust,” emphasizing the trust of customers, trust of society, and trust among colleagues.”

He also made clear that receiving the trust of customers is the Group’s foremost priority, stating: “No great product or technology is complete without the trust of our customers.”

Executive Chair Chung highlighted quality and safety as the most important factors of customer trust and advocated: “We must remain committed to our pledge toward quality and safety, and only then will our customers believe in us and support our path to change and growth.”

"Quality is a priority for all of us,” he continued. “From product planning to design, production, sales, and after-sales maintenance, all teams and employees must place quality and the customer as the top priority. We must all go above and beyond to earn the respect and loyalty of our customers.”

He also expressed his strong commitment to safety. “Our commitment to safety is not just about meeting external regulations. It’s about recognizing the priceless value of life and the principle of always making the best effort, which drives us to place safety of our customers and employees as the foremost priority."

The Group is putting extra effort into quality and safety management. Last year, Kia, Genesis and Hyundai Motor swept the top places in the J.D. Power Vehicle Dependability Study, the prestigious quality study in the U.S. The Group’s new models have also been recognized for providing the highest level of quality and safety in the world by the Insurance Institute for Highway Safety (IIHS) and Euro New Car Assessment Program (NCAP).

Furthermore, Hyundai Motor and Kia are further strengthening global safety management by appointing a Chief Safety Officer (CSO) and expanding safety-related organizations in their facilities around the globe.

Mr. Chung also underlined the need for the trust of society. Under the Group’s sustainability message, ‘The Right Move for the Right Future,’ “We will work together with society for the environment and co-prosper with humanity by setting a good example for others.”

Hyundai Motor Group is supporting various social responsibility management activities to fulfill carbon neutrality and deliver a sustainable future for the next generation, the environment and communities.

By 2040, the Group’s automotive brands plan to offer only zero-carbon EVs in major markets and are promoting projects to create and restore marine ecosystems, such as restoring tidal flats and collecting and recycling marine plastics. The Group’s affiliates also plan to replace the electricity needed at workplaces around the world with 100% renewable energy.

The Group supports small and medium-sized auto parts companies’ transition to electrification, operates support programs for co-growth, and is also engaging in activities to benefit future generations and vulnerable groups, through initiatives such as Hyundai Motor’s ‘For Tomorrow’ campaign and Kia’s ‘Greenlight Project.’

“To seek challenges and to make change happen, we need to trust in ourselves and each other,” Mr. Chung affirmed in his appeal for even greater levels of trust among colleagues. “By taking pride in the good we’re doing for humanity, I hope you communicate openly and rely on one another and strengthen trust among peers in the New Year.”

Making a new leap through proactive change ⋯ the need to create an active corporate culture that continues to change

Executive Chair Chung emphasized the importance of creating stability through a proactive change in his address. He shared his thoughts on changes in corporate culture and his belief that employees’ creativity and proactive change are indispensable for stable and sustainable growth.

“In order to achieve sustainable growth, we must overcome the status quo and create a corporate culture that is proactive and ever-changing,” he said. “Just as stagnant water quickly goes stale, a culture that does not evolve will be easily contaminated and broken. So, let us not be complacent, but make efforts toward new goals. To make a leap toward a new future, we will foster a culture where bold, new attempts are encouraged without the fear of outcome..”

“We must put an end to any meaningless tasks in our current way of working, and maximize the efficient use of time and human resources through prioritization,” he added. “I hope all of you will also evaluate your tasks and remove any unnecessary formalities that waste valuable time and energy and make smart, flexible work a part of your everyday life.”

He continued : “Let us be bold and not afraid of new challenges; be assertive and proactive in all matters; and value our peers and work closely with open communication. We must create a workplace where employees that work with diligence and enthusiasm are acknowledged and rewarded and can pursue their dreams.”

Mr. Chung also presented the importance of the younger generation. “We must heed the voices of our future customers, particularly the younger generation. Our organization must be structured in a way that the views of younger employees are reflected in the decision-making process, and we must communicate closely with them and understand their thoughts and values.”

Above all, Mr. Chung expressed: “I, along with other leaders at HMG, will lead by example and create a workplace that allows our employees to work freely and be respected and acknowledged, based on principles and common sense. We will promote diversity and carry out HR decisions and systematic improvements to create a dynamic and versatile corporate culture and remove any shortcomings from the past.”

In closing, Executive Chair Euisun Chung said, “Amid uncertain external circumstances and the rapidly changing industry paradigm, the Group, together, will continue to build trust by taking on challenges, and change proactively with a positive can-do spirit and thorough preparedness to make a new leap and achieve sustainable growth.”

“Let us all move forward on this journey ‘Together for a better future’.”