Hyundai’s chairman warns of tough year ahead for global auto industry
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South Korean carmaker Hyundai has been hard hit by US tariffs, and faces a construction delay due to an immigration raid on a Hyundai-LG Energy Solution plant in the US.
PHOTO: REUTERS
- Hyundai's chair Chung Euisun predicts a difficult year due to trade tensions, geopolitical conflicts and increasing competition impacting profitability.
- Hyundai faces challenges from US tariffs and construction delays due to immigration raids, costing the company billions of won.
- Chung Euisun acknowledges Hyundai's AI capabilities lag behind competitors, and plans investments in AI, robotics, and autonomous driving.
AI generated
SEOUL – Hyundai Motor executive chairman Chung Eui-sun has warned of a tough year ahead for the global auto industry, and said the South Korean carmaker needs to upgrade its artificial intelligence (AI) capability.
In his New Year remarks, Mr Chung warned that global trade tensions and intensifying competition would curb industry profitability, while geopolitical conflicts may impact operations in some regions, potentially leading to a suspension of business.
“This will be the year when the crisis factors we have long worried about become reality,” he said.
The largest South Korean carmaker has been hard hit by US President Donald Trump’s tariff regime, which has imposed a 15 per cent levy on Korean-made cars. That cost Hyundai about 1.8 trillion won (S$1.6 billion) in the third quarter alone.
Adding to the challenges, an immigration raid on a Hyundai-LG Energy Solution plant in the US last September is expected to delay construction by at least two to three months.
Mr Chung also said Hyundai is falling behind rivals in the AI race, calling for collaboration with a range of partners to ramp up its AI capability.
“If we look coldly at reality, leading global companies have already secured a dominant position in this field through investments worth hundreds of trillions of won, but the capabilities we have right now are not yet sufficient,” he said.
As part of its AI and robotics push, Hyundai launched the Robotics Lab in 2019 and acquired Boston Dynamics two years later. It plans to invest 125 trillion won in South Korea over the next five years in AI, robotics and other new technologies.
“As the focus shifts towards physical AI, the value of our moving entities, such as automobiles and robots, and our manufacturing process data will become increasingly rare,” Mr Chung said. “This is a powerful weapon unique to us that big tech companies can’t easily imitate.”
Motional, an autonomous driving joint venture with parts-maker Aptiv, plans to commercialise fully driverless Ioniq 5 robotaxis in Las Vegas by the end of the year, vice-chairman Chang Jae-hoon said. BLOOMBERG
