Hyundai 2004 Annual Report Download - page 5

Hyundai Motor Company Annual Report 2004_08
Letter from Vice Chairman
made its global debut in 1976 when we shipped
six vehicles to Ecuador. We have come a long
way since then. While it took 22 years to export
our first five million vehicles, we doubled that
number in just five and a half years. Hyundai
Motor Company currently exports cars to 193
countries all over the world.
Hyundai Motor Company is leading the world
to the era of futuristic vehicles. Last year, we
invested US$95.79 million/100 billion Won for
the development of our new second generation
fuel cell electric vehicle and hybrid car. Fleet
testing of our hybrid technology got underway
when we donated fifty Click hybrid cars to the
Ministry of Environment in Korea for use by
government agencies and civic groups. Our
goal is towards the mass-production of these
vehicles, at an annual rate of 300,000. We have
earmarked an additional US$287.3 million/300
billion Won for research in this area prior to
2010.
While the difficult global business environment
is expected to continue into this year, we antici-
pate that we will overcome it through several
marketing strategies. Internationally, we will
increase our market share by promoting sales of
profitable mid-size and larger vehicles, especial-
ly SUVs and minivans. Domestically, we will
launch several new models and market them
aggressively.
We also plan to expand our production bases,
including our overseas sales network in main
markets such as the United States, China, and
India. We are striving to make management
more flexible while at the same time improve
our financial structure in order to maximize the
interests of our respected shareholders.
During this coming fiscal year, we have set man-
agement goals of selling 2.41 million vehicles,
with corresponding sales figures of US$34.96
billion/36.5 trillion Won. These figures repre-
sent an increase of 14.6 percent and 12.3 per-
cent respectively. We hope to increase domestic
sales by 10 percent, and overseas sales by 58
percent. Also, we aim to increase the ratio of
overseas production in order to effectively over-
come direct and indirect controls in overseas
markets, reduce costs, and reinforce the local
marketing capabilities.
We will offset the short-term decrease in profit
rates and expand long-term growth through
the expansion of research and development
investment and brand value enhancement. We
will do this with an increase in market share
based on the stabilized operation of financial
structures. We will maintain the scale of overall
investments, similar to those we made last year.
In addition, we will actively support the devel-
opment of next-generation technologies by con-
siderably increasing our research and develop-
ment investment to 6.2 percent of sales.
Hyundai Motor Company will continually pro-
mote our policy “Innovation for Customers”
based on trust-based management, site-inten-
sive management, and transparent manage-
ment. This will contribute to harmony between
public interest advocacy groups and the auto
industry.
Global auto markets are unpredictable, charac-
terized by splits and mergers among global
automakers, unlimited competition, and the
rapid growth of large emerging markets such as
China and India. The global auto market keeps
changing.
As you are well aware, attaining aggressive busi-
ness goals under adverse market circumstances
such as a sluggish domestic economic environ-
ment and overheated, incentive-driven overseas
markets is not an easy task. However, we will
increase our competitiveness by realizing our
long-term vision and management philosophy,
increasing profitability through transparent
management, considering our shareholders first,
improving quality, and upgrading brand value.
We at Hyundai Motor Company will take advan-
tage of global markets through brand manage-
ment, global management, risk control manage-
ment, and people management.
We feel we have already secured the engineering
and technological foundation required to
become the number one automaker in the world.
Now, we will focus our energy on brand value
enhancement. We will successfully execute our
global brand strategy by developing the best sell-
ing cars, improving quality, and communicating
continually with our customers.
We will continue to expand our global manage-
ment in the coming year. Earlier this year, we
opened our new US$60 million proving ground
in the Mojave Desert near California City. And
our new Sonatas, to be manufactured in our
Alabama manufacturing plant, will arrive in
North American Hyundai showrooms in May. In
China, Beijing Hyundai is now topping the
monthly sales charts thanks to the enormous suc-
cess of the Elantra, which has emerged as the
top-selling sedan in that market. We are fur-
thering our success in the European and Indian
markets, and our market share keeps growing in
the Russian, the South East Asian, and the Latin
American markets.
Thus, we will actively execute our global man-
agement goals by reinforcing the supporting sys-
tem focused on export, securing the foundation
of overseas production bases, and reinforcing the
global research and development capabilities.
As you are well aware, the unpredictability of the
management environment has increased. As a
result, we will increase profitability by reinforc-
ing risk control management and maximizing
our shareholders’ interests. In addition, we will
recruit and train high caliber employees and
improve management efficiency by ensuring that
only appropriately trained personnel are dis-
patched on overseas assignments. We will perfect
management, utilizing personnel to enhance our
growth potential.
We are well aware that these remarkable accom-
plishments would not be possible without the
support of you, our valued shareholders. Despite
the unpredictable management environment,
we have confidently set high management goals
for this fiscal year in order to return value to you,
our shareholders in reward for your loyal sup-
port. We will not be satisfied with what we have
accomplished until we have become the global
leader among automotive companies.
Thank you.
Dr. Kim Dong-Jin, Ph.D.
Vice Chairman and CEO