Hyundai Motor chief's meeting with UAE president to boost presence in Middle East
Hyundai Motor Group Executive Chair Chung Euisun delivers a New Year address at Kia's AutoLand Gwangmyeong manufacturing facility, southwest of Seoul, Jan. 3. Yonhap
The latest meeting between heads of Hyundai Motor Group and the United Arab Emirates (UAE) is expected to help the Korean carmaker gain a huge impetus for its expansion in the lucrative Middle East market, according to industry officials and experts, Wednesday.
The outlook came in response to the closed-door meeting held Tuesday in Seoul between Hyundai Motor Group Executive Chair Chung Euisun and UAE President Mohamed bin Zayed Al Nahyan.
As Chung has displayed his strong affection to the Middle East as a land of opportunity for the group's sustainable growth, the meeting between the two figures is in itself widely expected to build momentum for the company to accelerate its expansion in the territory in a number of ongoing and future businesses, according to Kim Pil-soo, a professor of automotive technology at Daelim University College.
"As competition remains very fierce against Hyundai Motor's rivals in key overseas auto markets in the United States and Europe, the Middle East is definitely a great place for the carmaker's expansion for new revenues," he said. "But the Korean company is advised to build a somewhat different strategy there due to the geopolitical characteristics of the region."
The expert pointed out that the carmaker needs to place more strategic focus on the localization of its vehicle lineup there.
"For instance, the carmaker is urged to build a sales portfolio focusing on premium models there, as customers have bigger spending power there than those from any other regions," the expert said.
Hyundai Motor Group Executive Chair Chung Euisun speaks during a groundbreaking ceremony for its electric vehicle plant in the nation's southeastern city of Ulsan, Nov. 13, 2023. Courtesy of Hyundai Motor Group
The head of Hyundai Motor Group has reiterated the Middle East's importance for sustainable growth. Last year, he shared the group's vision to increase its market share in the region to more than 20 percent by 2030. To that end, the group also set a specific annual growth target of 6.8 percent each year until then.
Other experts also shared a similar view, saying that the carmaker needs to strengthen its premium brand identity for Genesis to appeal more to customers there.
"The group's move to expand in the region is a step in the right direction due to the region's growth potential," said Lee Ho-geun, an automotive engineering professor at Daedeok University. "But customers in the region prefer luxury and high-end vehicles to any typical cheaper models. As Genesis' brand power still remains weaker than its major overseas counterparts, the company has to come up with ways to attract customers there by possibly launching much more expensive high-end models worth more than 200 million won ($146,600)."
An official from the carmaker said the company will keep expanding its business portfolio in the Middle East.
"Hyundai Motor Group will continue to proactively diversify its business areas and seek new opportunities in the Middle East," the official said.