Hyundai and Kia brands in China preparing for the high-end decision-making speed cramming

Posted on 7/13/2016 10:15:31 AM

Before the Japanese car accidents due to Waterloo and successful host of Korean cars, Japanese brand in 2015 a full recovery and the rise of independent brands under attack, blocking growth in China frequently encountered.
Recently, industry rumors, Hyundai and Kia in China, production and marketing departments will be integrated, modern China will be unified under the jurisdiction of Hyundai and Kia sales business in China. Then Modern China responded that China and Kia, respectively, the news is not true.
Modern Chinese insiders Die Zeit correspondent, he said the reality is that South Korea's Hyundai Group headquarters on internal aspects of the work report of Hyundai, Kia two brands have been adjusted, with the current business in China and there is no direct contact.
This year, the Hyundai-Kia Group's two brands in China, the performance is still not ideal, though the Hyundai and Kia to adjust the level of reporting does not relate to specific operations in China, but modern Kia headquarters for business in China is not over long look in the eyes and ready to take action, it will also be presumed to be in preparation for its future high-end brands to enter the Chinese market and to pave the way.
Joint venture profits even lower in China
As the fourth generation of the Hyundai-Kia Automotive Group Global Group, recently in the Chinese market performance is not tepid.
In April, Hyundai released the 2016 first quarter earnings. Data show that Hyundai Motor net profit of 1.687 trillion won, down 12%. This is a modern ninth consecutive quarter of falling profits. The main reason for the continuous decline, the report analyzes mainly in China's largest market, sales of Hyundai Motor joint venture due to the poor.
Hyundai-Kia Group in the first quarter global sales of 1.108 million, up slightly by 2%, sales in the Chinese market to 10 million units, down 10%. Although the overall trend, still showing a recovery trend, but how to boost the performance of the Chinese market, has become a test of the Hyundai-Kia Group's new issues.
In order to respond to changes in the Chinese market, the Hyundai-Kia first began relatively good start importing cars to be adjusted. Hyundai-Kia sales to China in the past imported car business can be attributed to both China Business Division jurisdiction to be attributed to China's Overseas Sales Division jurisdiction business unit, now this part of the Hyundai-Kia Group's business in China to unify all of China Business Division, by the its report directly. Insiders pointed out that this evaluation, the aim was to reduce the level of reporting business in China, in order to enhance decision-making speed of business in China, but is also possible that the Hyundai-Kia Group for future decisions to adjust China's domestic operations to test the water.
2015 Hyundai-Kia sold 1.679 million in China, Hyundai Kia Group is the world's largest single market, accounting for nearly 21% of global sales. However, due to falling sales in China, Hyundai Kia Group had pre-set targets in 2015 8.2 million last but not complete.
Last year, Hyundai-Kia group appeared in China two joint ventures with different degrees of decline: Beijing Hyundai Motor sold 1.06 million, down 5.1%; KIA sales of 620,000, down 4.6%. This is the first Korean-brand cars fell in the high-growth Chinese market for eight consecutive years from now.
Into 2016, the performance of the Hyundai-Kia joint venture in China is still not much improvement. May Beijing Hyundai sold 100,328, although an increase of 25.4%, but the first five months of total sales are still 5.4% year on year decline; and the KIA in May to achieve sales of 50,122, an increase of 2.3%, 1 --5 month cumulative sales of 240,588, down 9.4%.
Some analysts pointed out that the main reason for the decline of Korean cars is due to the gradually emerging from the external environment had affected the full recovery of the Japanese brands, sales rebounded quickly regain previous years eroded the market share of Korean cars; second is by virtue of its own brand SUV cost advantage of products occupy a large market share, making an already rely mainly on selling price of Korean cars have lost the biggest advantage. The most important thing Korean cars had to promote its focus remains on top of cost and product strength, lack of brand power to shape the course is strongly required to make up its future.
To prepare for the high-end brands
In August last year, Hyundai and Kia to make adjustments for the Chinese market, known as crisis management experts of the Hyundai-Kia Group Vice President LI Bing Hao, he served as general manager of Beijing Hyundai; the same as the vice president of the Automotive Group Planning Minister Jin Jian served as headquarters of Dongfeng KIA managing director.
In modern automobile 30 years Bing - Hao has served as the US market leader, later transferred to headquarters in South Korea, responsible for overseas auto and sports marketing, has extensive experience in marketing. The new Jin Jian, general manager of Dongfeng Yueda Kia, Kia Motors has served as Planning Minister, responsible for the promotion Kia imported cars. The two executives are masters of marketing, after its arrival has taken a series of measures to curb the decline in sales and a 30% decline in margin narrowed to 6%.
While the Hyundai-Kia Group has created the so-called "modern speed", but later grew to a certain size, and then count on a "soaring" The idea is not realistic. Like strength and brands have experienced before stronger Japanese brands Waterloo, also experienced a dormant period in 2023 and adjustment to the new start.
LI Bing Hao, general manager of Beijing Hyundai expressed, lower car sales growth trend has spread worldwide, Beijing Hyundai also encountered unprecedented challenges, but there is still room for development in China, to Beijing Hyundai brought new development opportunities; Dongfeng Yueda Kia CEO Kim also believes that although the large environmental impact, China's automobile market slowdown, but China is still the world's largest auto market, the growth rate is higher than the rest of the world.
From the degree of completion of the sales point of view, Beijing Hyundai 2016 sales target of 112 million, an increase of 5.7% over last year; Dongfeng Yueda Kia 2016 sales target of 680,000, an increase of nearly 10% over last year. In the first 5 months, Beijing Hyundai to achieve sales of annual sales target of 38%, KIA first five months to complete the annual sales target of 35.2%, to accomplish the goal of this year there is a certain possibility.
Auto market analyst Zhang Zhiyong had Weekly Times correspondent said South Korea's brand value and brand image in the Chinese market is still a relatively low level, the lack of high-end brand is an important factor restricting the further development of the Korean brand.
Currently the actual Korean brand market competitiveness in China is still "cost", while in better brand power of Japanese brands with German brand competition to Hyundai and Kia brands, led by South Korea lost the holy grail.
At the same time, the same price as a selling point to rely on SUV and part of independent brands also suffered a sales decline in the situation, therefore, how to enhance the brand power of the Hyundai-Kia will become the focus of one of the next phase of the game market in China. In fact, last year they have started this layout and bedding, November 4, 2015, Hyundai Motor posted online at the official launch of independent luxury brands Genesis statement, the statement stressed that "the new Genesis will be first-class brand with worldwide luxury car brand to compete, "and announced the next five years, the new Genesis brand will launch six new cars.
Modern speed, I believe that the new brand will soon meet with Chinese consumers, perhaps for the adjustment of the imported car business in China, that is to pave the way for new brands to enter.

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