Hyundai Motors SWOT Analysis

 Hyundai Motors SWOT Analysis 2018


Hyundai is one of the leading automobile manufacturers of the world. The brand has grown faster in the recent years based on its focus on technological innovation. Apart from great technology and good quality products, the brand is also known for its excellent manufacturing capabilities and global presence. The brand is quite popular in the Asian markets which account for a very large part of its sales followed by North America. Its retail sales globally grew in 2016 and so did its revenue.

However, the competitive pressures in the automotive industry have grown requiring higher focus on technological innovation and marketing. Hyundai has an extensive supply chain and distribution network. Apart from that it is focusing on the development of eco-friendly vehicles to meet the changing demand of the customers. 2016 was a challenging year in several ways but despite that Hyundai performed relatively well. These uncertainties are expected to remain for some years. However, Hyundai is planning to become a leading manufacturer of eco-friendly automobiles and is investing heavily in this area. The is a SWOT analysis discussing the strengths, weaknesses, opportunities and threats before the automobile brand.

CEO & Chairman – Chung Mong Koo

President: Won Hee Lee

Number of Employees (2016): 118320

Number of vehicles sold (2016) globally : 4914000 approximately.

2017 Revenue: 96376 Billion Korean won

2017 Net Income : 4546.4 Billion Korean Won


Brand image: Brand image has become an important factor influencing sales in the 21st century. Customers trust only the brands having a good brand image. Such brands attract higher sales and have a larger customer base. Hyundai has a strong customer friendly image globally. Its product portfolio is filled with products falling within different price ranges.

Global Presence: Global presence of the Hyundai brand is also an important strength. The brand and its sales and distribution network is present globally from Brazil to North America. Its suppliers are scattered around the world from China to North America. It also makes vehicles locally around the world to reduce its manufacturing costs and keep product prices under control.

Strong hold Asian markets -: The brand has grown highly popular in the Asian markets. Its China and India factories produced the highest number of vehicles in 2017.  Its new Hyundai Creta SUV was highly popular in the Indian market. Several other small family car models like i10 and i20 have also achieved very high level of popularity in the Indian market. While Asian market are its strong hold, some of its models have been popular in the US market too. Its Elantra and Sonata models are popular in US apart from Santa Fe. However, the sales of these models saw a decline in 2017. On the other hand, Asia is the biggest market for Hyundai where it sold more than 1.88 million vehicles in 2017. Asia sales represented 38.4% of the brand’s entire sales worldwide.

Large product portfolio -:  The brand has a large and varied product portfolio that  caters to various customer segments from various income groups as well as tastes. Apart from the passenger cars, small family cars and SUVs, the brand also makes MPVs, eco friendly cars and the Genesis brand cars. Elantra, Sonata, Santa Fe, Tucson and Creta to IONIQ the brand sells a large range of highly popular vehicles. This product portfolio is meant to suit the pockets of a very wide customer base from those who want small cars of family use to those who want luxury cars and SUVs.

Focus on technological innovation -:  The brand has opened several research and design centres around the globe.  Apart from its Namyang research centre in Korea, the brand has opened several research centres around the globe. In 2016, it spent 2352.2 Korean Won on research and development which was higher compared to its R&D expenditure in 2015. In 2015, it spent 2172.4 Billion Korean won on R&D.

Strong manufacturing capabilities and distribution network -: Its Ulsan plant in South Korea is the single largest automobile manufacturing plant in the world. It also has manufacturing plants in US, Brazil, Russia, China and India. Hyundai has built manufacturing plants worldwide for producing cars locally and to reducing manufacturing expenditure.


  Hurt image due to recalls -: Vehicle recalls can have a damaging effect on a brand’s reputation. In 2018, Hyundai had to recall more than 44000 vehicles in US which was because of defect in the steering wheel. The recalled vehicles included Santa Fe and Santa Fe sports cross overs. Apart from the recalled vehicles in US, the brand also recalled around 8000 vehicles in Canada. Such recalls can hurt brand image and reduce the trust of the customers in the brand.

– Increased expenditure on marketing -: Due to the intense competition in the automotive industry, the brand’s expenditure on several things including R&D as well as marketing has increased a lot. In 2016, its advertising and promotions expenditure increased to 2233 billion Korean Won from 2071.8 Billion Korean Wons in 2015.


– Digitisation and eco friendly innovation -: Automotive brands have several opportunities in terms of innovation. Digital technology offers new opportunities of increasing supply chain and distribution network efficiency. Apart from that investment in digital technology can also he,p improve the brand’s production and sales network as well as after sales customer service. Increasing demand for eco friendly cars all around the globe is  a major opportunity in itself. Investing more in development of eco friendly and low emission technologies can help the brand grow its popularity and sales faster.

– Growing demand in Asia markets -:

The demand for cars in the Asian market and especially family and passenger cars and SUVs is growing fast. However, not just Asia, the demand for cars has increased globally and apart from Asia Pacific and Europe, North America also experienced rising demand for cars. This presents a significant opportunity for car brands like Hyundai that  can invest in better design and quality to bring cars as per the customers’ changing preference.

– AI and automated driving -:

The race for automated driving is catching heat day by day. More and more brands are investing in AI and automated driving technologies to be their first. Hyundai too can invest in these areas to provide its customers with better vehicles and a better overall customer experience.


– Heavy competition -: The most remarkable thing about the automotive industry currently is the intense competition. In this intensely competitive environment, the pressure to invest in upcoming technologies as well as marketing and skilled human resources is very high. The race has become quite tough making the entire affair costlier for existing brands while entry of new brands is next to impossible. Heavy competition also means more pressure related to customer retention. All of this results in higher costs and Hyundai has to invest much in product quality and marketing to retain its market share.

– Legal regulation and compliance risks -: The legal and regulatory environment around the world is growing increasingly tough.  Compliance risks have grown and from labor to environment there are several areas where compliance risks have grown. Increased pressure of compliance also means that the brands may face higher fines for non compliance which can translate into losses worth Billions as happened in the case of Volkswagen  in 2015.

– Currency fluctuations -:

Another major threat before the automotive brands are the currency fluctuations. 2016 became a challenging year because of ongoing currency fluctuations which also affected demand. Currency fluctuations coupled with slower than expected recovery in several markets like Brazil, Russia, Africa and the Middle East also led to lower demand. These threats affect sales and revenue of Hyundai.


Hyundai Annual Report 2016