Mon, Dec 30, 2013 - Page 15 News List

Hyundai replaces US unit CEO due to slowing growth

Bloomberg

Hyundai Motor Co, South Korea’s largest automaker, named a new chief executive officer for its US unit as it seeks to boost sales after combined deliveries with its affiliate trailed the US market’s sales pace the past 14 months.

David Zuchowski, executive vice president of sales, will replace John Krafcik as president and CEO effective on Wednesday, the Seoul-based company said in a statement on Friday.

Hyundai said its contract with Krafcik, 52, expires at the end of this year.

Hyundai and affiliate Kia Motors Corp, which share engines, model platforms and a chairman, have trailed the industrywide US sales pace in each month since September last year as the rebounding Detroit Three and Japanese automakers checked their growth in the US market.

The South Korean affiliates agreed last week to spend as much as US$395 million to settle lawsuits related to claims that they overstated the fuel-economy ratings of their vehicles.

Before its recent slowdown, Hyundai outperformed other automakers in the US market during Krafcik’s tenure.

He joined the company in 2004 as vice president of product development and strategic planning and became CEO of the US unit in late 2008.

While Hyundai’s market share this year has slipped by 0.3 percentage points to 4.6 percent through last month, the company claimed just 2.5 percent of the market in Krafcik’s first year with the company, according to researcher Autodata Corp.

Hyundai last month unveiled a revamped all-wheel-drive Genesis premium sedan that will go on sale in the US next year to revive flagging sales in the model’s largest market.

The all-new Genesis, which competes with Bayerische Motoren Werke AG’s 5-series and Daimler AG’s Mercedes Benz E-Class in the midsized premium sedan market, is also set to be introduced in Europe next year, its first premium model in the market, the company said on Nov. 26.

The new model and the replacement of the head of the US unit come as the Seoul-based carmaker is suffering from an appreciating won.

Third-quarter profit at Hyundai fell 11 percent from the previous three months to 2.14 trillion won (US$2 billion), the company said on Oct. 24. Net income advanced 5.6 percent from a year earlier.

The won has gained about 22 percent against the yen this year, curbing Hyundai and affiliate Kia’s competitiveness against Japanese automakers in exporting to the US.

The won strengthened 0.5 percent to 1,054 won per US dollar in Seoul on Friday, data compiled by Bloomberg show.

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