REPORTER'S NOTEBOOK Hyundai Motor's stock rally puts Munoz to test

How much of Hyundai Motor's dramatic stock rally can be attributed to CEO Jose Munoz?

Since taking the helm in January 2025 as Hyundai Motor's first foreign CEO, Munoz has faced U.S. tariff pressure, intensifying competition and a rapidly changing auto market. Yet the company's stock has nearly doubled, rising from around 220,000 won ($159) when he took over to 415,000 won as of Friday's close.

Munoz can point to several achievements.

He has put a greater focus on the group's U.S. business, where Hyundai Motor has maintained its market share despite the 15 percent U.S. auto tariff. The company has also expanded its hybrid lineup and increased local production in North America. At the same time, Munoz has pushed Hyundai Motor, Kia and Genesis to work more closely on engineering, manufacturing, purchasing and distribution to cut costs and protect profits.

Those efforts have helped Hyundai Motor maintain strong sales, despite a challenging business environment. Second-quarter revenue hit a record 49.2 trillion won, but operating profit fell more than 20 percent from a year earlier as tariffs and other costs squeezed margins.

But the biggest boost to Hyundai Motor's valuation has come from beyond its core auto business.

Investors have increasingly focused on Hyundai Motor Group's push into robotics and physical artificial intelligence (AI). Boston Dynamics, the group's U.S. robotics company, has become a key part of that story, especially with its humanoid robot Atlas.

That story helped push Hyundai Motor's shares to a record 750,000 won in June, more than three times their level at the end of 2024. Investors were increasingly valuing Hyundai Motor not just as an automaker, but as a potential player in robotics, AI, autonomous driving and future mobility.

The stock's subsequent drop, however, has been a reality check. Shares have fallen to the low 400,000-won range, showing how quickly investor sentiment can change when auto earnings fail to keep up with expectations for new growth businesses.

This creates a new test for Munoz.

His first challenge was to protect Hyundai Motor's profitability and competitiveness amid trade uncertainty. His next may be harder: showing that the group's investments in robotics and physical AI can generate meaningful earnings.

The CEO Investor Day on Wednesday could provide important clues. Investors will want to see specific investment plans, commercialization timelines and potential revenue from AI and robotics, rather than just broad ambitions.

For Munoz, the challenge is no longer just navigating a difficult auto market. It is turning the group's ambitious transformation into a sustainable source of earnings.

If he succeeds, the stock rally could mark the start of a longer-term transformation. If not, the rally may prove to have been driven more by expectations than fundamentals.