Hyundai Motor Group (HMG), which is comprised of twin brands Hyundai and Kia, has announced that it is strengthening its CV business with a regional focus for product development, a global design center, and a production hub in South Korea.
New analysis from Frost & Sullivan, Executive Outlook of Hyundai's Global Commercial Vehicle Market Activities, finds that HMG's CV market share can grow from the 2.5 percent it established in 2014 to 4.1 percent by 2022. However, strengthening of the South Korean Won beyond 1,150 to 1,100 per United States dollar will impede market development.
From 2014 to 2022, only 18 percent of HMG's CV incremental annual sales will emanate from Europe and North America, while 76 percent will derive from China, the Association of Southeast Asian Nations, the Middle East and South America, according to the Frost & Sullivan research.
"With a largely untouched overseas market, the company's CV shipments will more than double over the 2014-2022 time period," said Frost & Sullivan Automotive & Transportation Senior Research Analyst Silpa Paul. "Across geographies, the medium-duty (MD) and heavy-duty (HD) series of Hyundai Mighty, Hyundai HD series and Hyundai Xcient, will receive maximum technological focus in order to increase the powertrain range, improve fuel efficiency, and add connectivity-linked safety and convenience features at competitive prices."
However, the rising proficiency of Chinese and Indian vehicle original equipment manufacturers, who also offer low-volume, high-margin trucks in key markets such as Africa and South America, will significantly challenge HMG's growth plan for market leadership in these regions. In order to succeed, HMG will have to develop feature-laden MD-HD platforms to entice value truck customers in the global market, according to the Frost & Sullivan research.
"Although HMG is a relatively unknown force in the CV market, strong brand value, combined with design and feature-addition marketing strategies will catalyze HMG's growth in the global CV market," noted Paul. "In regions like the Middle East and Africa, the establishment of high-quality completely-knocked-down and semi-knocked down assembly partnerships will also aid swift business expansion."