Hyundai fires its U.S. Chief.

[mmcartalk]

http://www.autonews.com/article/20161221/OEM02/161229959/hyundai-fires-u-s-chief-zuchowski

LOS ANGELES -- Hyundai Motor America has fired CEO Dave Zuchowski for failing to meet internal sales objectives, multiple sources familiar with the situation told Automotive News.

The decision is effective immediately. Jerry Flannery, 59, general counsel and an executive vice president, will be the interim CEO until a successor is chosen. Hyundai said it will begin its search immediately.

Hyundai’s dealer body was informed Tuesday night of the decision.

“We appreciate Dave’s decade of service to Hyundai, especially his leadership as president and CEO, which has made us a stronger organization,” Flannery said in a statement. “I look forward to working closely with our dealers, affiliates, senior management and our talented and hard-working employees across the country to realize Hyundai’s full potential.”

Zuchowski, 58, who joined Hyundai as U.S. sales chief in 2007 and was widely respected in the dealer body, took the CEO position at the start of 2014, succeeding John Krafcik, just as Hyundai’s growth was beginning to slow.

While the brand survived and even thrived early in his tenure as sales boss following the Great Recession, it struggled to maintain its pace as falling gasoline prices led the U.S. market to shift away from Hyundai’s bread-and-butter small cars and toward crossovers and SUVs, segments where the brand is weak or nonexistent and where supply shortages have dented sales.

Hyundai’s U.S. sales through November were up 1.3 percent to 707,485 units, excluding the new Genesis luxury brand, which recorded 1,306 units. U.S. sales for the Hyundai make, including models that now fall under the Genesis umbrella, hit a record in 2015 of 761,710 units, up 5 percent from the previous year, but the growth rates are down from double-digit growth in 2010 and 2011.

Zuchowski, a 36-year veteran of the auto industry, joined Hyundai from Mazda North America, where he was vice president of sales and field operations.

Zuchowski’s ultimate successor will oversee the continued development of Genesis in the U.S. and Hyundai’s aggressive move into alternative-fuel vehicles in the U.S., including the launch of its Ioniq sub-brand. Hyundai plans to release 14 new alternative-fuel models in the U.S. by 2020.

 

[mmcartalk]

Hyundai Motor America has fired CEO Dave Zuchowski for failing to meet internal sales objectives

Maybe those objectives were unrealistic. One cannot simply pull numbers out of a hat and necessarily expect them to be met.

Zuchowski, 58, who joined Hyundai as U.S. sales chief in 2007 and was widely respected in the dealer body

Hyundai’s U.S. sales through November were up 1.3 percent to 707,485 units, excluding the new Genesis luxury brand,

U.S. sales for the Hyundai make, including models that now fall under the Genesis umbrella, hit a record in 2015 of 761,710 units, up 5 percent from the previous year,

Seems like no good deed goes unpunished.

Hyundai said it will begin its search immediately.

All I can say is good luck on the search...........while Dave gets the last laugh, out enjoying a nice round of golf.

 

[mikeavelli]

I hope they are not blaming Genesis on him b/c that is DOA...

 

[Ian Schmidt]

I was gonna say, I think Hyundai's product mix is more of the problem than him. I guess it's like baseball: you can't fire the lineup, so fire the manager.

 

[mmcartalk]

I hope they are not blaming Genesis on him b/c that is DOA...

I wouldn't count out Genesis just yet. Infiniti also got off to a rocky start 25 years ago, and is still in business, though obviously not with the kind of sales Lexus has.

 

[mmcartalk]

I was gonna say, I think Hyundai's product mix is more of the problem than him. I guess it's like baseball: you can't fire the lineup, so fire the manager.

Much of it, IMO, is not with the line-up or product-mix, but with the public themselves. With some exceptions, public perception of Hyundai and Kia is probably a good fifteen years behind the times. That is why their products depreciate more than they really deserve to, and why some people won't even go look at them in the showroom.

There are a number of examples I could site, but a typical one was recently when one of our condo-board members asked me for some advice on a new-vehicle replacement. Among some other brands, I named a couple of Hyundai and Kia products that I thought could fill the bill at a reasonable price. She winced, tightened up, and blurted out that there was no way she is going to buy a Kia or Hyundai...and she wouldn't even cite a reason why not. She might (?) have gotten stuck with one of their old lemons twenty years ago...that's the only thing I could think of.

 

[Tragic Bronson]

The issue IMO is the Korean chaebol culture...Japanese corporate culture has its issues, but Koreans just seems worse. I still think they made a mistake of letting their previous Prez John Krafcik go. If anything, he has gone to better places, and probably Dave Z will end up somewhere too.

If Hyundai wants their reputation to improve, this type of s**t better stop, or the rest of the world (like Japan, whom they will always try to benchmark) will keep looking down on them despite how far they've come. Toyota learned lessons and have made changes. Chairman Chung (Hyundai's big honcho) had better do something or else they'll be stuck.

http://www.autonews.com/article/20161221/BLOG06/161229956/korea-inc-s-year-end-executive-shuffle

Korea Inc.'s year-end 'executive shuffle'

The firing of Hyundai Motor America CEO Dave Zuchowski -- coming as it does only a few days before Christmas -- is poorly timed and reinforces the image in the U.S. that Hyundai burns through American CEOs at an alarming rate. But placed in the Korean company’s cultural context, it is not that unusual.

When I was running global PR for Hyundai Motor at corporate headquarters in Seoul (2010-2013), I discovered one charming end-of-year tradition: Each team would go around to their bosses’ offices, shake hands and wish them a happy new year. There was a sense of optimism and a looking forward to the next business year.

Then there was another year-end tradition, common to all big Korean companies, or chaebol, that could have a darker side: the “executive shuffle.”

Companies such as Samsung, Hyundai Motor and LG like to have broadly experienced executives, with a wide knowledge of company operations. The end of the year was the time for job reassignments, or executive shuffling, and even though the process was an expected part of life at Hyundai, and other chaebol, the shuffle could often come with surprises.

An executive at headquarters might find out, for example, that he is being “shuffled” to Moscow, or Frankfurt, or Sao Paulo. Usually, this was for a promotion, so that part was good. But the executive may not have known about the plan until he was informed of it. And the transfer was expected to happen nearly immediately -- often within a week.

This would send families of Western executives into an uproar. Though it did not make life easy for Korean families, they were conditioned to expect it.

If an executive was being shuffled from Hyundai headquarters in Seoul to the Seoul headquarters of an affiliate company, the change could happen the same day. I left a present for one of my bosses on his desk one morning in December and I never found out if he got it -- at lunchtime, he was promoted to a top job at an affiliate company and was already gone.

Then there were the executives who were shuffled off elsewhere. Some underperforming ones would be transferred to smaller affiliates. If they did well there, they could rejoin Hyundai Motor headquarters in the future, like a big leaguer sent down to the minors to fix his swing, with the hope of making it back to "The Show."

'He is happy'

Other underperforming ones, however, were sacked, which is the same in corporations everywhere. Though in the Confucian culture of Korea, it was referred to obliquely. Colleagues would say only that a fired executive “went home.” Usually it would be added, “he is happy,” meaning he got a severance.

In the U.S. and the West, we are used to long-serving CEOs. But this is not the case in Korea. Only the family owners of the great chaebols remain in top jobs for long periods. Non-family COOs or presidents, even successful ones, rarely hold top jobs for more than four or five years.

This is partly due to the reshuffling, but also to the way in which the chaebol hire and promote their people. The chaebol typically hire college graduates (women, right out of college; men, after their nearly-year-compulsory military service) at entry-level.

There, they labor for four years. If they perform well, they are promoted to the next level, where they stay for four years (there are exceptions of those promoted sooner), and so on, spending 20 years in working-level jobs until they have the chance to be promoted to the executive ranks. Then, there are several levels, and years, until they reach a top job.

Not far from retirement

The point is, by the time a Korean salaryman reaches a top, non-family, executive job, he may be only four or five years from retirement, so there is not a culture of holding onto leadership jobs for several years, as in the West.

None of this, of course, makes things easier for Dave Zuchowski, whom I know and like. Having worked for Hyundai before winning the top job, I’m sure he went into it with open eyes, knowing the company culture.

I bet he wishes the company would have made some more SUVs for him to sell, because that’s what customers want. But I also bet he’ll land a great new gig soon.

Frank Ahrens is the author of “Seoul Man: A Memoir of Cars, Culture, Crisis, and Unexpected Hilarity Inside a Korean Corporate Titan.”

 

[mikeavelli]

Okay I wasn't aware they have been having issues for sometime.. it's not just the USA .. good article below
http://www.ibtimes.com/great-recess...oom-after-financial-crisis-then-later-2465498

 

[Tragic Bronson]

One of my cousins is interested in a Kia, but I'm actually wanting to steer them in the direction of the Hyundai rather. They're not looking to buy a Honda or Toyota (He has his reasons, fine by me), and is looking at a base Forte, and not the Soul that to me is the best car they sell.

I would rather the sister vehicle the Elantra because it is built either here or in Korea. The new Forte, is built at Kia's new plant in Mexico, so for me, I'd rather not have him deal with a lot of potential first year issues, considering what happened to Honda in their new plant building Fits and HR-Vs also there. I happen to like the Elantra's styling better and it also has some great incentives as well right now.

 

[mmcartalk]

One of my cousins is interested in a Kia, but I'm actually wanting to steer them in the direction of the Hyundai rather. They're not looking to buy a Honda or Toyota (He has his reasons, fine by me), and is looking at a base Forte, and not the Soul that to me is the best car they sell.

I would rather the sister vehicle the Elantra because it is built either here or in Korea. The new Forte, is built at Kia's new plant in Mexico, so for me, I'd rather not have him deal with a lot of potential first year issues, considering what happened to Honda in their new plant building Fits and HR-Vs also there. I happen to like the Elantra's styling better and it also has some great incentives as well right now.

Some valid concerns on your part. But, on the other hand, is the local Hyundai dealership where your cousin lives as good (or better) then the Kia shop? Do they treat customers as well? Do they give better, more honest deals? Are there problems with service or repairs? Have there been any buisness-related problems with them in the local press? Maybe (?) there is a reason why your cousin prefers a Kia.

 

[Tragic Bronson]

Some valid concerns on your part. But, on the other hand, is the local Hyundai dealership where your cousin lives as good (or better) then the Kia shop? Do they treat customers as well? Do they give better, more honest deals? Are there problems with service or repairs? Have there been any buisness-related problems with them in the local press? Maybe (?) there is a reason why your cousin prefers a Kia.

That is going to be the next step, to have him try the Elantra and see if that will change his mind or not. Since the Kia dealer is very close to him (walking distance actually), he has been able to test drive a Forte. The Hyundai store is a couple cities away.

I personally have already done a Truecar for the Elantra, and three TC dealers have emailed me already (probably dealer SOP, even one left a message on my Google voice, since I'm not ready to give out my cell #). And this was all last night (Christmas)...

My cousin is a little bit of a hermit and wants just a base version.

 

[mikeavelli]

The article surprises me by saying they need more SUVs...I honestly didn't realize how many SUVs they had until traveling this past year and realizing they are all parked in the fast lane no matter what city I go to...To me they have a ton of offerings but I guess the big wigs are saying they should have more.

Everyone was betting on small cars/sedans due to gas prices but since gas prices have lowered and stayed stable the shift to SUVs has been huge which we have talked about here.

Without me asking around, I am not sure how this guy got fired in 2 years. There isn't much you can do in that time.

 

[mmcartalk]

I am not sure how this guy got fired in 2 years. There isn't much you can do in that time.

Tragic Bronson gave what seems a credible opinion on that, at least to some extent. He feels it has to do with Korean culture....they have a tendency not to keep CEOs very long.

 

[Tragic Bronson]

Without me asking around, I am not sure how this guy got fired in 2 years. There isn't much you can do in that time.

I don't even know exactly why they let go the CEO before him (John K., who even spent time at NUMMI)...he was probably the best leader they had but probably due to the same 'Korean' reasoning he was let go then, and he's doing fine now at Waymo/Google. Kia has had some management changes as well but somehow Hyundai's news are usually more prominent, particularly when John K was at the helm (because he was well respected inside and outside the company).

If anything, they couldn't adjust their product mix quick enough as they can't make enough SUVs and make too many Sonatas/Elantras; even Toyota knows there's an overabundance of Camrys right now and they want more capacity for Highlanders/RAV4s. If anything, Dave Z was probably in the face of the Korean execs pleading for more SUVs to sell.

 

[Tragic Bronson]

Tragic Bronson gave what seems a credible opinion on that, at least to some extent. He feels it has to do with Korean culture....they have a tendency not to keep CEOs very long.

Toyota usually does change executives often, but they are usually sent to other parts of the company or back to Japan. Pretty rotational. If anything, Hyundai should really learn that.

 

[mmcartalk]

Toyota usually does change executives often, but they are usually sent to other parts of the company or back to Japan. Pretty rotational. If anything, Hyundai should really learn that.

As I see it, with their somewhat differing management styles, both Toyota and Hyundai seem to be doing quite well at the the present time, even if Hyundai didn't meet its on-paper sales-goals on paper. Hyundai may not be quite Toyota's current size, but they rank from fourth to sixth-largest automaker, depending on who does the ranking and how they measure it....and they just started a new upscale Genesis division. IMO, it's hard to find fault with that.