SEOUL • Hyundai Motor Group promoted heir apparent Chung Euisun yesterday to a role of overseeing the conglomerate, moving him a step closer to succeeding his octogenarian father as head of South Korea’s second largest group.
Mr Chung, 47, who will assist his father and group chairman Chung Mong-koo, was made executive vice-chairman to respond to “deteriorating global trade issues and changes in competitive dynamics in major markets”, Hyundai Motor Group said in a statement.
Chaebols like Hyundai and Samsung Group, which have grown into global firms from the rubble of the 1950-1953 Korean War, are undergoing a transfer of power to thirdor fourth-generation leaders.
“Executive vice-chairman Chung Eui-sun will oversee the entire group’s operations, aiding and reporting to chairman Chung Mong-Koo,” the statement said.
The appointment also comes as Hyundai battles tumbling profits, rising pressure from activist shareholders to improve its governance, and amid South Korea’s trade tensions with the US that threaten to disrupt its production plans.
The younger Mr Chung, now vice-chairman of the group’s crown jewel Hyundai Motor, has stepped up his activities in recent years, attending motor shows and government meetings with business leaders on behalf of his 80-year-old father who has made few public appearances.
Shares in Hyundai Motor ended up 0.8 per cent yesterday, and affiliate Kia Motors fell 0.3 per cent in a wider market that rose 1.4 per cent.
Chairman Chung, the all-powerful boss, has presided over Hyundai for about two decades, transforming the company into the world’s fifth-biggest carmaker along with Kia Motors.
But Hyundai is struggling to reverse slowing sales in China and the US, where the company has suffered due to its delayed response to booming demand for SUVs.
The younger Mr Chung has led efforts to develop future vehicles such as autonomous and connected cars, as well as Hyundai’s fledgling premium brand Genesis.
A major challenge for him will be how to consolidate his holdings in the group.
Hyundai Motor Group in May shelved an ownership restructuring plan that would have tightened the family’s grip and paved the way for a succession. The plan had been opposed by US activist hedge fund Elliott Management.
South Korea’s government has called for reform of the country’s family-owned conglomerates in the wake of a graft scandal that led to the ouster of a president, as well as the arrest of the Samsung Group chief.