TechnologyMichael Cole, President and CEO of Hyundai Motor Europe: "Dealers have been a key factor in our success in markets like Spain"

Michael Cole, President and CEO of Hyundai Motor Europe: “Dealers have been a key factor in our success in markets like Spain”

Since July 1, 2020, michael cole is the President and CEO of Hyundai Motor Europe. Having held various senior management roles at Kia over 11 years, most recently as President of Kia Motors America, the Oxford Brookes University Accounting graduate is challenged to continue the company’s transition to electrification, but , as clarified in this exclusive interview with Business Insider Spainwithout neglecting the fuel cell and combustion engines.

The South Korean manufacturer has been the first in the world to incorporate all alternative energies into its range of cars: hybrid, plug-in hybrid, microhybridization, 100% electric and fuel cell variants.

“We believe in electrification. In fact, we see ourselves as a leader in electrification and sustainable vehicles. We have a very clear position, because we have all the different technologies in this gradual transition from internal combustion to zero emission vehicles over the next ten years. The reality is that by 2035, today, we will have to be zero emissions throughout Europe; that’s only twelve years away. I think that with the product development that we have, we will be in a position to do it by 2035 at the latest,” maintains the top executive of Hyundai’s European division.

For this wide variety of technology, among other reasons, Hyundai Motor Company sold 3,944,579 vehicles worldwide in 2022, representing a year-on-year increase of 1.4%, a percentage that increases to 2.9% if Korea is excluded from the equation thanks to the 3,255,695 units it managed to sell.

In Europe, the result was also positive. 518,566 units were sold, representing an increase of 0.5% compared to 2021, reaching a record market share of 4.6%. As far as sales of zero-emission vehicles are concerned, they grew by 19% —according to Jato, 1.56 million pure electric vehicles were sold in the ‘Old Continent’.

And this despite the fact that electric car sales are going at different rates depending on the country. In Norway, which this year has decided to tax this type of car again, they accounted for 79.3% of sales. In Sweden they represented 33%, in the Netherlands 23%, in Denmark 21% and in Finland, Switzerland and Germany 18%. Spain is far behind, with 3.8%.

“We have the same product available in Spain as in Norway, and the rhythm is totally different. Is it about infrastructure? I think so, but also the acceptance of certain markets to be electrified. And because of that difference we must be aware that some markets still want internal combustion and that it will potentially extend until 2035,” explains the president and CEO of Hyundai Motor Europe.

“Probably, in the next 12 months, half of the sales that will be made in Europe will be electric vehicles. But there are also some markets where internal combustion will be more than 50%. Our position is to offer customers the mobility that meets their requirements. And the reality is that today, in some markets, it’s more internal combustion, and in others, more electric,” Cole stresses.

Without a doubt, Hyundai is one of those brands that has turned to the electrification of its range. A clear example are the two models that have been born as 100% electric: the Ioniq 5 and the Ioniq 6, with which it has sold 100,000 units in 2022 in the world. But the figure could be even higher if the brands equated the price of this type of car with combustion.

In this regard, Michael declares: “It is a good challenge. There are always economies of scale that impact that. But, of course, there are also raw materials and, as we have all seen in the last six months, factors that are out of control of our industry, global geopolitical problems… The cost of electric vehicles has actually risen as has the cost of raw materials. So I think there are two factors that are going to be on the next scale. And clearly, the more electric vehicles we introduce, the more it allows us to get to that scale. But also we need to understand what is the impact of precious metals on batteries. That’s what makes it challenging, I think: achieving price parity.”

And that is where the formulas that most manufacturers are adopting come in: renting, leasing… “More and more consumers say they’re looking at mobility through use rather than ownership. So we’re seeing more customers buying vehicles on financing programs, leasing programs where they pay monthly becomes the critical factor.So even if we have higher retail prices, if residual value and if the used car market is strong for EVs, we may get to a point where the monthly payment may be much closer to an internal combustion vehicle“adds Cole about it.

The Hyundai Ioniq 6 is the latest electric car that has reached the range of the South Korean manufacturer.
The Hyundai Ioniq 6 is the latest electric car that has reached the range of the South Korean manufacturer.

Another alternative technology that is currently expensive is hydrogen. Thomas Schäfer, CEO of the Volkswagen brand, recently ruled out in another interview with Business Insider Spain the fuel cell in passenger vehicles due to its high price, in addition to subtracting space in the passenger compartment with its necessary deposits. Cole thinks differently. What’s more, Hyundai was a pioneer in this field with the sale of the Hyundai ix35 Fuel Cell in 2015 —in 2005 it presented a prototype, the Tucson FCEV— and with the Nexo in 2018, a product that is still sold in Spain.

We still strongly believe that hydrogen is part of the solution.. The battery, electricity and the hydrogen fuel cell can happily coexist. And I think maybe, it varies depending on the size of the product. So I think the smaller cars are more likely to be battery electric vehicles. We will reach a point where hydrogen is the most viable solution in the future for the largest SUVs. Today our focus is obviously more on trucks. But the Nexus remains a demonstration of how the hydrogen fuel cell will also become part of a passenger car solution. So: yes, we are fully committed to the development of electric vehicles, both battery and fuel cell.”

The automobile industry is changing by leaps and bounds. There are many brands that have stated that they no longer consider themselves manufacturers of automobiles, but of mobility services. In 2019, Lutz Meschke, Vice President of the Board of Management with responsibility for Finance and Information Technology at Porsche, said that they had to think of new business models to survive. That same year, Honda presented its plan to become an energy supplier associating with the companies Vattenfall, Ubitricity, Moixa and EVTEC. For its part, Toyota established Kinto Europe, a new mobility services company of vehicle, car and ride-sharing subscription services and multimodal solutions.

Hyundai IONIQ 5

“We started thinking about connected car technologies, automation. As a group – Kia-Hyundai Motor Group – we are looking a lot more around mobility services and solutions. Now we have a big interest in robotics and urban mobility. This all starts to paint that piece of delivering mobility to the customer across all the different types of solutions. I think that’s where we’re going to see the biggest change,” says Michael, who knows the automotive industry very well, which he He has been linked for 37 years and in which he has worked in almost all its fields.

Another of the actors in the sales chain of a product that is changing, more or less depending on the brand, are the dealers. In some cases they will evolve into centers of brand experiences, instead of being mere commercial transaction centers. What the president and CEO of Hyundai Motor Europe is clear about is that they continue to play a very important role by being the connector between the manufacturer and the customer.

Dealers are very important to us. We believe that this has been a key factor in our success in markets such as Spain. We have a large network of agreements, and without that network of distributors, we cannot achieve our goals. So they remain the interaction between the customer and the brand. Our role is to make sure we create a landscape of mobility products, services and solutions so that the dealership becomes the point where we interact with the customer. So we remain committed to the dealership model,” says Cole, who began his career working in Ford’s UK dealer network in 1985.

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