BUSINESS STRATEGY

Lecturer: Dr. Willibeth C. Candol

Student: Doan Dang Minh
Student ID: 17BM40223
Case study: Hyundai Motor Company.
Submission date: 14th January 2020.

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Table of Contents
I. Introduction: .................................................................................................................................. 4
II. Hyundai Mission, Vision and Objectives: ................................................................................. 6
1. Hyundai’s Vison: ....................................................................................................................... 6
2. Hyundai’s Mission: .................................................................................................................... 6
3. Hyundai objectives: ................................................................................................................... 7
III. Strategy: ..................................................................................................................................... 7
1. What is strategy? ....................................................................................................................... 7
2. The levels of strategy: ................................................................................................................ 7
3. Role of strategy: ......................................................................................................................... 8
Clarity in Direction of Activities: ......................................................................................................... 8
IV. Strategic planning technique: .................................................................................................. 10
1. Dogs: ......................................................................................................................................... 10
2. Question marks: ....................................................................................................................... 10
3. Starts: ....................................................................................................................................... 10
4. Cash cow: ................................................................................................................................. 11
V. Stakeholders: ............................................................................................................................... 11
1. Internal stakeholder: ............................................................................................................... 11
2. External stakeholder:............................................................................................................... 11
3. The significance of stakeholder analysis to Hyundai: ............................................................. 11
4. Stakeholder matrix: ................................................................................................................. 12
VI. Environmental: P.E.S.T.E.L analysis: ................................................................................. 13
1. Political: ................................................................................................................................... 13
2. Economic:................................................................................................................................. 14
3. Social: ....................................................................................................................................... 14
4. Technology: .............................................................................................................................. 14
5. Legal:........................................................................................................................................ 14
6. Environment: ........................................................................................................................... 15
VII. Strategic positioning: Ansoff’s growth vector matrix: ............................................................ 15
1. Market penetration:................................................................................................................. 16
2. Product development: .............................................................................................................. 16
3. Market development: ............................................................................................................... 16
4. Diversification: ......................................................................................................................... 16

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VIII. Poster’s five forces: .............................................................................................................. 17
Bargaining Power of Customers/Buyers ......................................................................................... 17
• Bargaining Power of Hyundai’s Suppliers (Weak Force): ..................................................... 18
• Threat of New Entrants (Moderate force): ............................................................................. 18
• Bargaining Power of Customers/Buyers (Strong Force): ....................................................... 18
• Threat of Substitutes or Substitution (Strong Force): ............................................................ 18
• Competitive Rivalry or Competition (Strong Force): ............................................................. 18
IX. SWOT analysis: ....................................................................................................................... 18
1. Strengths: ................................................................................................................................. 18
2. Weaknesses: ............................................................................................................................. 19
3. Opportunities: .......................................................................................................................... 19
4. Threats: .................................................................................................................................... 19
X. Conclusion: .................................................................................................................................. 20
XI. References: ............................................................................................................................... 20

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 I. Introduction:
Business strategy plays very important role in the existence and development of every business.
The right business strategy will create a good direction for businesses, the business strategy can
be considered as a guide to instruct businesses in the right direction. In fact, there are many
traders thanks to the right business strategy that achieve much success, overcome competitors
and create their position in the marketplace. Business strategy is the means that the entrepreneur
wants to achieve the business goals and strategies as a long-term business plan. In this task, as a
business analyst, the writer will analyze the internal and external business environment of the
organization and come up with some strategies to improve the organization’s business situation.
The models that will be used in this analysis include: Pestle analysis, Swot analysis, Porter’s
Five Forces model, Ansoff’s growth vector matrix, etc. in order to give everyone an overview of
Hyundai’s business stages and eventually the analyst will give advice to help Hyundai improve
weaknesses for the future development.

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II. Hyundai Mission, Vision and Objectives:
Hyundai automobile company was founded in 1947 by Chung Ju Yung. At first it was known as
Hyundai Engineering and Construction company. Until 1967, the Hyundai automobile company
was officially established and exported to 190 countries around the world and famous for the
sales of auto in Korea.
Located on the east coast of Korea, the Hyundai company operates the world’s largest car
manufacturing facility in UIsan. Namyang Technology Research Center was established in 1996.
Currently, HMC is operating 8 research centers in Korea and 4 international centers including
countries like USA, Foundation Valley. Hyundai’s technology center uses an annual budget of
about 5% of its revenue with 4,100 researchers. Their research projects included: solar powered
cars, electric cars, fuel cell vehicles, etc.
In 1990, the Hyundai California Design center was created, creating a new definition of
advanced manufacturing facilities for the automotive market. The models that the center has
designed include: Roadster HCD-1, HCD-2, HCD-6. Multi-purpose sports cars such as Hybrid,
Cross Tour and HCD-7 are luxury models. It can be said that the influence of the design and the
best known is Hyundai Tiburon (Sport coupe) and Santa Fe (sport utility vehicle).
(Hmmausa,n.d)
1. Hyundai’s Vison:
By investing in mobile services, Hyundai is trying to provide freedom of movement for everyone
by investing in this service. By turning hydrogen into a globally economically efficient energy
source, Hyundai plays an extremely important role in the globe, they build close relationships
with leading and expanding mobile providers. Their role is more in the field of automobile
transport. (Hyundai,n.d)
Hyundai declares its new vision in 2020 “together for a better future” together they build
“progress for humanity”, doing the right thing for humanity, because “humanity unities to help
them stronger”. Hyundai strives to be a “lifetime partner in the automobile sector and beyond” to
bring its brand to customers and to serve customers is Hyundai’s leading motto. (Hyundai,n.d)
Hyundai emphasizes that customer satisfaction is the highest as well as the quality of the
products is always first. By bringing innovation to customers by offering a combination of the
automobile, steel and construction sectors. With the goal of becoming a leading organization in
the world, Hyundai will purse more sustainability in its business operates. In addition, Hyundai
also takes responsibility for society and humanity into its vision. Company policy and strategy
are affected by this factor a lot to stakeholders. All of these visions promote future Hyundai
business performance. (Hyundaimotorgroup,2020)
2. Hyundai’s Mission:
Hyundai’s business philosophy is to improve the lives of people around them, to fulfill the
mission of global company and be respected people around the world. Hyundai’s goal will be at
the forefront of the automobile industry with “Four Best” included: “Best service, Best quality,

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Best value for customers and Best technology”. By harmonizing quality and efficiency to create
a special value for customers, Hyundai always provides its responsibility to the community and
environment, creating stability and security for future generations. “Realizing the new dream by
creating a new future through clever and continuous thinking are the borders we want to explore
and conquer”. (Hyundaimotorgroup,2020)
3. Hyundai objectives:
Korea’s largest auto manufacturer Hyundai Motor aims to increase annual vehicle sales in the
US market to more than 1 million units in the next 5 years, an increase of 40% compared to
2019. Mr. Munoz’s CEO Hyundai in North America said that vehicle sales in the Us market will
increased by 4.7% compared to 2018, to 710,007 units. He said that 2021, it will increase to
728,000 units and increase by 1 million units by 2025. To accomplish this goal, Hyundai will
expand the range of sport utility vehicles (SUV) and develop 17 additional electric cars in 2025
to meet customer’s need for environmentally friendly cars.
Analyst say the Hyundai appears to be on the right track when adding SUVs to its lineup and
focusing on the US, European and emerging markets to offset weaknesses in the China, Hyundai
aims to sell a total of 7.4 million vehicles in 2019. In the first nine months of 2019, Hyundai sold
5.27 million units, fulfilling 71% of the target. (Bnews,2019)

III. Strategy:
1. What is strategy?
In order to achieve one or more goals for the organization, a strategy was born. It can also be
considered as a general direction for the organization to achieve the desired states. The outcome
of a strategy will succeed or not depends on the strategic planning.
(Managementstudyguide,2018)
Strategy is the most efficient arrangement of resources which is considered the art of planning.
Meanwhile, strategic planning needs to be scrutinized because any action can be subject to
multidimensional reactions from stakeholders: Customers, employees, competitors, suppliers,
etc. (Businessdictionary,2019)
Strategy is the actual behavior of others or the uncertainly of things that must be considered in
terms of definition, knowledge, goals. The organization’s goals are expressed through strategy,
which is a decisive detail. It helps members identify the work that organization is aiming to
contribute to shareholders and future customers. (Managementstudyguide,2018)
2. The levels of strategy:
There are three levels od strategy for a company are: corporate, business and functional.
Corporate strategy:
Corporate level strategy helps the company to identify the business areas in which it operates
that are related to resources, align resources related or not related to the organization, additional
positions, element need to change, etc. The corporate level strategy is managed by senior

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managers responsible. The process of achieving an organization’s vision is viewed through
strategic level. (Seprianhidayatamin,2018)
Business strategy:
Business level strategy relate to individual product markets, business level strategy is defined for
business units that help them define their competitive position, based on common leadership
strategies, distinguish and focus overall costs to build business level strategy.
(Seprianhidayatamin,2018)

Functional strategy:
A strategic business unit with different functions will create relevant functional level strategies.
Include human resource management, production and operations, marketing. Together with the
teams and functional heads associated with business level strategy. It helps businesses set short-
term goals. (Seprianhidayatamin,2018)
3. Role of strategy:
The strategy plays a very important role for the organization because it provides an overall
strategy for the management department and specific areas will be given a specific orientation.
These strategies may include marketing strategies, organizational development strategies and
human resources development strategies. (Knowledgeblob,2016)
Strategy has many roles in the organization. This article will present the 4 most common roles.
Framework For Operational Planning:
The strategy provides executive decisions and frameworks for the plan. Planning is more perfect
if managers understand it correctly and they will provide more consistent data and information
for planning. Customers and geographic areas are strategically zoned.
For example, Hyundai will launch new SUVs cars in the US market, Hyundai will allocate more
human resources to research and development activities as well as prepare for the budget.
(Marketwatch,2018)

Clarity in Direction of Activities:

By pointing out the activities that will accomplish the goals of the organization the strategies will
be oriented. The goals of the organization will be clear and specific.
For example, Hyundai wants to increase its market share in the US by 15%, reduce inventories
and sell 1 million cars by 2020. This is Hyundai’s strategy that provides a clear goal, a level of
profitability. Profits earned by the company and what resources are required for the strategy.
When the goal is clearly stated, it will provide clear direction for each person in the organization.
Most members will work better if they know what they are doing. (Marketwatch,2018)
Increase Organizational Effectiveness:

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The main effect is that the organization achieves its goals within planned resources. Resources
must ensure the organization’s maximum goals. At different times, the organization’s resources
can be used at the different times. In order to the organization to be effective, the resources are
put into operation in the way that it has been designated which is the strategy must ensure.
(Marketwatch,2018)

Personal Satisfaction:
Whether or not the strategy works, look at the organization’s satisfaction. Strategic management
processes are followed in the workplace and they will be more satisfied because they know their
role and reduce conflict. If the decisions in the strategy are codified with all members of the
organization, they will know how to proceed, make suggestions and elect decision makers. From
there, the individuals level effect is perfected through everything that is made clear and the
strategy will be fully utilized. (Marketwatch,2018)
To sum up, in order to achieve success and affirm the company is a quality brand in the minds ò
customers, Hyundai has adhered to its business philosophy, constantly creating “New thinking,
new possibilities”. Continuously innovate products, seize opportunities both in challenges and
have a suitable business strategy.
The corporation strategy and functional strategy are mainly used by Hyundai as its business
strategy. For Hyundai, a business strategy is the key to a company’s victory over rivals.
Outstanding principles that Hyundai is following:
- Growth through acquisitions and alliances:
In the face of globalization, many companies have to use mergers and acquisitions and alliance
to increase their international presence and expand their market share in new markets, especially
developed countries. In 1999, Hyundai officially acquired a stake in Kia Motor Company
(33.38%) to carry out a comprehensive restructuring and create a new car alliance (Hyundai- Kia
automotive group). Hyundai and the other work together, but under two separate brands to make
the most of it. Hyundai and the other said their third-quarter profits increased by 51% and 9.4%
compared to last year, to 460.5 billion won (393 million USD) and 325.8 billion won. Hyundai in
the acquisition has strengthened both the domestic and global markets and together became the
fifth largest automobile manufacturer in the world. (Bnews,2018)
- Establish a global joint venture:
Many automakers have teamed up with partners outside the company to develop self-driving car
technology, including the alliance between Jaguar Land Rover and Google Waymo company or
the cooperation between BWM and Mercedes-Benz. In this situation, Hyundai has decided to
cooperate with Aptiv Plc, which is separated from General Motors division to develop self-
driving car technology. Accordingly, this joint venture will develop self-driving car technology.
Hyundai added that the joint venture will begin testing fully self-driving systems by 2020. Based
on the terms of the two-party cooperation, Hyundai and Aptiv will each hold 50% of the joint
venture. Hyundai will contribute 1.6 billion USD and 400 million USD for research and

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development. In turn, Aptiv provides autonomous driving technology with its 700 employees.
(Baomoi,2020)
Engage in emerging market:
For example, in India where is the population is large, low-income, their need for a cheap car,
moderate quality, suitable for income. To meet this large-scale demand, Hyundai designed the
car with minimal features and amenities, acceptable quality, to bring the price down. Hyundai’s
main factory is also located in India with low transportation costs, tax incentives, land and
infrastructure. From India factory, Hyundai will export its cars to Vietnam, in the Vietnamese
market, Hyundai sold 1,609 Grand i10 cars in 2019, increasing its sales to 8,785 units.
(Thoidai,2020)

IV. Strategic planning technique:

Boston Matrix: (Product and service portfolio): BCG Matrix
It helps businesses analyze portfolio and brand portfolio. This toll is widely used in marketing
and business strategies. Put individual products in the range and put them in the matrix and then
matrix and then map out the competitors’ products to gain a relative market share.
1. Dogs:
“Products with low market share and low market growth. Regularly breakeven, neither spend nor
collect money”. (Businessnewsdaily,2017)
Hyundai Elantra is Hyundai’s slowest selling product. despite possessing a sharp, beautiful
design and a series of modern equipment, it has many errors such as after a few thousand km
tires have edema cases, Troy batteries have cases after 20,000 km, it is broken, light steering
wheel though turning to sport mode feels a bit dangerous for the driver at high speed (this is the
downside), front sensor collision error. (Danhgiaxe,2019)
2. Question marks:
“Goods with low market shares in strongly growth markets.” (Protichighosh,2018)
with cars made in Vietnam, some Hyundai car models are also in short supply. The Hyundai
Kona model, launched on 22 August 2019, has more than 1,000 orders. Hyundai had to cut other
models to save production for Kona. as such, it can also reduce the supply of other models such
as Acent, Santa Fe, i10, etc. Many customers have to wait until the end of the year to receive the
car. (Vietnamnet,2019)
3. Starts:
“Products in high growth markets with high market shares.” (Protichighosh,2018)
From the early days of entering the motor market, Toyota is the main competitor of Hyundai. we
can see these two brands competing almost in all areas from advertising, marketing, customer
segmentation, after-sales, customer service. (Thegioixe,2018)

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Regarding product segment: Toyota has more cars but Hyundai is putting pressure on rivals. the
Japanese automaker has Vios, which consistently tops the sales but in the remaining segments
are weaker than Hyundai. Toyota has no product to compete with the Hyundai Kona and Tucson.
now Santa Fe and Everest are growing fast. The two champions have top-notch products but
Toyota depends too much on Vios (nearly 34%). Hyundai is less dependent on a product because
the Accent and i10 sell approximately the same and they dominate the market more.
(Vnexpress,2019)
4. Cash cow:

“Products in low growth markets with high market shares.” (Protichighosh,2018)

Hyundai Elantra 2019 has gone through countless difficulties seemingly impossible to escape.
misunderstanding in the purpose of design, the indifference, restraint of consumers or the
shaking of experts’ heads. It took nearly two decades for the Hyundai to escape the design flaws
that it created and rise to breakthrough changes, the Elantra gas reached the market with the
stability of engines and modernity in the interior and personality in appearance. additional
amenities are well taken care of, and Elantra prevails and reaches out to the world. however,
Hyundai has produced too much which leads to uncontrolled quantity and exceeds the needs of
the consumer, so cash loss is essential. (Bmwvietnamcars,2019)

V. Stakeholders:
1. Internal stakeholder:
The entity of a business is internal stakeholders. for example, board of directors, investors,
managers, employees. Employees who want to make money should stay in the company to work,
maximize the profits that the business generates that is the concern of the owner, investors are
concerned about the owner’s income. (Courses,2019)
2. External stakeholder:
Entities are not in the business, but they are concerned and are affected by business performance
(consumers, investors, suppliers). by corporate financial conditions, the government wants them
to pay taxes, comply with the law and do not cheat on their financial statements. Customers want
a good quality product but low cost, always have to buy from suppliers that is their desire. debts
are always expected to be paid in full and on time by the lender. Positive contribution to local
activities and protection of the environment is what people expect from businesses.
(Courses,2019)
3. The significance of stakeholder analysis to Hyundai:
In order to have the opportunity to make a profit for the company, it must have a long-term
relationship with stakeholders, thereby helping the business operate effectively and have the best
opportunity to make a profit. During the product development process, stakeholders have the
right to feedback (positive, negative) to make company more successful. in addition, the
company may gain loyalty from the new stakeholders. Thanks to the stakeholders, the company

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 can develop trendy and scientific. The company can present the most appropriate plans in the
future, parts of the company are also affected by its affiliates. (Project-management,2019)

Hyundai Motor Company

Motivating In order to create maximum productivity, Hyundai managers should analyze the role of
employees each department. for the company to have the most effective workforce, evaluate
employees based on performance and revenue results they achieve. creating affair,
friendly environment that everyone wants to contribute, managers must understand the
current needs of employees and the benefits that businesses provide to each member so
that employees will understand which they are building for the organization. in addition,
Hyundai must strictly apply the law that does not discriminate in the workplace and
Hyundai always closely supervises the recruitment process and ensures a fair promotion
for all employees.

Marketing The motor business market is getting hotter and bigger than ever, competition is getting
strategies fiercer, and Hyundai is a famous motor business in the world to succeed like today, they
had to rely on the demands of customers, their products attract customers not only for
their beautiful design but also for the increasingly perfect quality. They listen to
consumer’s opinions, they are always at the forefront of trends in market prediction,
customer demand, and changing customer needs. know that people like cars that save
fuel and protect the environment. Hyundai is always researching the best inventions to
increasingly improve their products to help people and life.

4. Stakeholder matrix:

Figure: Stakeholder matrix 12

 Although there are different versions related to the quadrant, it is a graph drawn in four
quadrants. a specific stakeholder that falls into the quadrant can make a decision and the
stakeholders are analyzed to counter some criticisms. (Stakeholdermap,2018)
Stakeholder Stakeholder interest Strategies / action to meet interest

Customers Communicate and connect Create trust when buying Hyundai

relationship, support products.

Shareholders Achieve ownership levels in the Buying share of stock for the company
business by bringing resources into to be maintained and successful
the business to ensure the business is
always well run

Employees To encourage employees to work Hyundai often motivates employees to

effectively increase the level of
success for the company, Hyundai
brings an interesting and fair
workplace to everyone.
be interested in their work. they always
give employees more days off and pay
increases. depending on the level and
performance of each person, the higher
the compensation.

Suppliers Ensuring Hyundai receives the best Hyundai guarantees deadlines for
supply quality for electronics and vehicles. They always ensure strict
automation items. monitoring to the quality management
and their supply chain management.

Community partners Organization promotions, advertising Survey google form or hand out leaflets
support to spread the world.

VI. Environmental: P.E.S.T.E.L analysis:

Together with SOWT this is a tool for bird’s vision of the entire environment form a variety of
perspectives identifying threats and opportunities, creating an objective view.
1. Political:
Taxes are one of the important sectors that make a country’s policy. Hyundai is a global brand,
in some area where Hyundai’s products are produced, distributed and traded, each some
countries has different tariffs and sometimes price increase on material,etc.

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On December 22,2017. President Trump signed the current tax code reform tax bill. In addition
to the 2018 income tax change. I n 2019, the tax law is as follows if you bought a car in 2017, on
a return in 2017 you can deduct the tax for this car. In return, along with the vehicle registration
fee. the limit of 10,000 USD is property txes and income taxes. you can deduct local taxes and
state taxes.
2. Economic:
Economic development is not only a good condition for some organization, but it also affects
development of a country. Population growth steady which is a potential market, higher healthy
awareness, average life expectancy increase, The strong dollar rise combined with the winder
consumer trend of soda consumption in major markets such as India, Australia and the US made
Hyundai’s revenue decline. According to the Singapore combined newspaper, Vietnam is the
country with the fastest economic growth rate in Asia. Up to now, Vietnam has had 12 free trade
agreements. In which Vietnam and the European Union at the end of June,2019 have agreed
and signed two important cooperation documents, including a free trade agreement Vietnam-EU
(EVFTA) and Investment protection agreement Vietnam-EU (EVIPA). With a developed
economy, the rising material life will be a great motivation for Hyundai to develop because
Hyundai products have a large market share and a firm foothold in the market. (Bnews,2019)

3. Social:
Most of the social meaning is seen in advertising campaigns and slogan sentences. Therefore, the
Hyundai had to adjust the campaign designs to suit different cultures. High population aging in
developed countries such as Korea, China, Japan and some Southeast Asian countries changes
the social basis, government policies and business strategies of Hyundai while the age of
Hyundai serve mostly from 20 to 45 years old. (Notesmatic,2018)

4. Technology:
In the age internet boom, all the good and bad news is shared with just one click, the media has
proved extremely helpful for brands on product marketing. Hyundai also uses media to post and
share advertising videos and images, understand and address consumer concerns. The pace of
change in retail technology, the increasing transformation of digital, artificial intelligence, 3D
printing and other technologies that focus on speed convenience and popularity allows shoppers
free to choose on retail channels. Technology helps PepsiCo produce and supply chain. PepsiCo
is always looking for any solution that can reduce the cost of delivering products to customers
and improve service as one of the company’s top goals. Hyundai uses the advanced technology
to recruit talent from around the world and invest in Research and Development to maintain their
IT infrastructure. It is including network and system monitoring, security policy upgrades and
employee training. (Notesmatic,2018)

5. Legal:

For Hyundai this is a threat factor because many laws and regulation have different standards in
developing and emerging market, for example, laws related to product labeling, advertising,
international trade, the law of discrimination, Intellectual property law, etc.
For example, Work health and safety (WHS) – sometimes called occupational health and safety
(OH&S) – involves the management of risks to the health and safety of everyone in your

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workplace. This includes the health and safety of anyone who does work for you as well as your
customers, visitors and suppliers. Enterprises must use health and safety measures at the
beginning of their business. Under Australlia’s WHS law (2011), businesses must ensure the
health and safety of their employees and not jeopardize the health and safety of others.
(Business,2018), any form of penalties will affect the business results of the company

6. Environment:
Climate change and global warming are becoming major concerns often mentioned on social
networks and economic forums. According BBC news, Vietnam, China, Korea, Australia, etc are
the countries most at risk. Hyundai and businesses should control emissions and solid emissions
to reduce the amount of carbon emission into the atmosphere as well as the commitment that
Hyundai is aiming for. Hyundai is responsibilities for the environment. They separate processing
areas from residential areas to avoid noise and air pollution, they are always at the forefront of
environmental protection. every year, Hyundai also suffers from big storms and tsunamis.
draught, etc. significantly affect business and their costal industrial parks. (Notesmatic,2018)

VII. Strategic positioning: Ansoff’s growth vector matrix:

Ansoff's Matrix is a model of marketing planning which helps a company to determine its strateg
y for product and market growth.
The matrix shows that businesses trying to grow depend on marketing new products or develop
product in the market. (Tutor2u,2018)

Figure: Ansoff’s growth matrix

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 1. Market penetration:
Market penetration where businesses focus on selling existing products to existing markets is
placed in a growth strategy. Market penetration has four main goals: maintaining or increasing
the market share of existing products, dominating the growth market, increasing the use of
existing customers, restructuring mature markets.
Demonstrate determine to penetrate the market of nearly 1.4 billion people. Hyundai is
determined to build the 4th assembly house in China in Cangzhou city. the Cangzhou factory uses
the latest automation equipment and technology, the original capacity plant of 200,000 units per
year, focusing on small vehicles and the strategy of 300,000 units in 2018. (Bnews,2018)
2. Product development:
Develop products where businesses introduce new products to existing markets. request
amendments or develop new competencies to attract current market. to remain competitive in the
market. Focus on research and development, understand customer needs, bring products to
market first.
Hyundai’s product development strategy is compatible with culture, psychology, infrastructure,
weather conditions, tax rates, and warranties in the countries where they are trading. must be
constantly renovated and improved step by step to attract customers, product quality
corresponding price, to meet the needs of sustainable development of customers.
because Hyundai is strong in supporting industries, strong in finance, strong in scientific and
technological research. Hyundai chooses most segments:
Low-end models: Pony, Excel, i10
Midsize cars: i30, i40, Santa Fe, Sonata, Accent
Luxury cars: Sedan, Genesis, Veracruz. (Bnews,2018)
3. Market development:
Developing markets where business find and sell their products into new markets: new markets,
new product packaging sizes, new distribution channels, different pricing policies.
Hyundai has a serious plan to develop automobile production in Vietnam, deputy prime Minister
Trinh Dinh bravely hopes that Hyundai Group will accelerate technology transfer, expand
investment in Vietnam and affirm the new policies built with the principles of consistency,
stability and transparency to ensure the sustainable development of the automotive industry.
(Baomoi,2018)
4. Diversification:
business marketing new products in new markets. this is a risky strategy because trading in a
market has no experience.

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 Hyundai has grown from a labor intensive company specializing in low value-added products to
its products, to a company specializing in knowledge and technology-intensive products. to
reduce costs, Hyundai has also chosen a strategy to diversify its geographical market, using
cheaper labor to gain a competitive cost advantage, which could improve Hyundai’s position in
the world market. if diversification is ineffective, many of the subsidiaries will go bankrupt, so
Hyundai will not be able to survive this long. recognizing the power of Hyundai in Korea is
important in understanding its diversification capabilities.
VIII. Poster’s five forces:

Threat of new entrants

• - Low switching costs (strong force)

• - Moderate customer loyalty (moderate
force)
• - High cost of brand development (weak
force)

Bargaining Power of suppliers

Industry rivalry Bargaining Power of
- High overall supply (weak Customers/Buyers
force) Toyota,
- Low forward integration of - Low switching costs (strong force)
Mazda - High access to product
suppliers (weak force)
Ford information (strong force)
- Moderate size of individual
- High availability of substitutes
suppliers (moderate force) Honda (strong force)

Threat of Substitutes or Substitution:

• - High performance of substitutes (strong

force)
• - Low switching costs (strong force)
• - High availability of substitutes (strong force)

Figure: Five Forces analysis of Hyundai

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 • Bargaining Power of Hyundai’s Suppliers (Weak Force):
Suppliers scattered across the globe, no bargaining power because they are small in size and
Hyundai has financial strength. Suppliers only work with qualified and experienced partners with
their supply chains. The bargaining power of Hyundai suppliers is low
• Threat of New Entrants (Moderate force):

The risk of new entrants to the auto industry is average. in the auto industry, the threat of new
entrants always exists, but barriers to entry are low, in addition to legal, infrastructure, and
human resources barriers. investing billion of VND into this industry is extremely difficult for
new entrants.
• Bargaining Power of Customers/Buyers (Strong Force):
The bargaining power of customers has become stronger due to the increasing level of
competition and many brands are increasingly investing in marketing and increasingly perfecting
the quality of their products. Every customer has different needs and different tastes when
deciding to make a major purchase which has made the industry race increasingly fierce, the
brand not only focusses on quality but also after-sales and service, the level of technological
innovation.
• Threat of Substitutes or Substitution (Strong Force):
It could be the public transportation alternative to Hyundai. Different segments also have car
brands that cater to them. From the low-end, mid-range and high-end cars. Hyundai also sells to
a very large customer segment that spans all segments. Branding, financial strength and
technological innovation are the threat factors from alternative products.
• Competitive Rivalry or Competition (Strong Force):
The intensity of competition in the industry is extremely fierce to gain market share, promote
marketing investment and product research. Moreover, in an age of globalization of digital AI,
technologies evolve to create more sustainable materials in the manufacturing process and in
creating products. brand image is strong and reputable can affect consumers. After-Sales and
customer care regimes are also increasingly advanced.
IX. SWOT analysis:
1. Strengths:
- Brand image and equity:
Hyundai has built a brand with a good image, they have higher sales and Hyundai always
carriers the brand’s friendly image with people. Hyundai’s product portfolio is diverse and serves
all classes.
- Worldwide presence:
Hyundai distributes its products worldwide from Asia Pacific to Brazil, North America. Investors
and factories are everywhere like China and Vietnam. Manufacturing and assembly in that
country’s local market reduces costs and keeps product price low.

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 - Focus on the technological innovation:
Hyundai is not only financially strong, but also a car company that is hard at technological
innovation, they always invest in research and development. their research centers are present
around the world. in 2016, Hyundai spent 2352.2 won on research and development. (Bota,2018)
2. Weaknesses:
- The brand has been too long:
In 2018, Hyundai recalled 4,400 vehicles in the US due to a steering wheel error. The recalled
models include the Santa Fe and the sports Santa Fe. In Canada, Hyundai also recalled 8,000
vehicles. this recall has reduced customer confidence.
- increasing marketing costs:
Hyundai’s cost in research and development have increased greatly due to the increasing
competition in the automotive industry. In 2016, marketing expenses increased to 2233 billion
won. (Bota,2018)
3. Opportunities:
- The brand has many opportunities for innovation:
Technology has provided new opportunities to improve quality management processes and
supply chain management process. The growing demand for environmentally friendly cars is a
great opportunity for Hyundai. To help Hyundai grow popularity and sell faster, as it meets eco-
friendly technology
- Increasing demand in the Asian market:
Demand for cars, especially family cars, passenger cars of SUVs is growing fast. the demand of
markets like Europe and North America is also increasing in cars. Hyundai should invest more in
quality and design to match the needs of consumers. (Bota,2018)
4. Threats:
- Regulatory risks:
The worldwide legal environment is increasing day by day. Brand that fail to comply will be
subject to higher penalties.
- Intense competition:
Pressure on technology investment as well as marketing and skilled human resources. The race
has become fierce due to customer retention. All this has resulted in higher costs.
- Currency fluctuations:
Exchange rates are always volatile. in 2016 has been a challenging year for Hyundai due to
currency fluctuations as well as a slow recovery like in brazil, Russia, Africa, and the Middle
East. (Bota,2018)

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 X. Conclusion:
No organizational strategy would be like a boat without a rudder, it goes round and round
without a destination. Failure will be evident without proper strategy and effective
implementation. Strategic planning is not so complicated as many organizations thisn and they
do not often do it. Developing an appropriate and effective strategic plan will help senior
managers and employees know the destination and goals. To get Hyundai like today, they have
had many failures and they always create differentiated products, strong distribution systems.
XI. References:
Bota,2018. Bota. [Online]
https://bota.vn/mo-hinh-swot-cua-hyundai-motors-2018-p2/
[Accessed 15 1 2020]
Project-management. Project-management.
https://project-management.com/what-is-stakeholder-analysis/
[Accessed 15 1 2020]
stakeholdermap,2019. stakeholdermap. [Online]
https://www.stakeholdermap.com/stakeholder-matrix.html
bmwvietnamcars,2019. bmwvietnamcars[Online]
https://bmwvietnamcars.com/hyundai-elantra-2019-buoc-ra-tu-that-bai-de-khang-dinh-chinh-
minh/
[Accessed 15 1 2020]
hanoimoi,2019. hanoimoi[Online]
http://www.hanoimoi.com.vn/tin-tuc/dich-vu/936863/hyundai-new-mighty-n250sl-chinh-thuc-
ra-mat-thi-truong-viet-nam
[Accessed 15 1 2020]
news.zing,2019. news.zing[Online]
https://news.zing.vn/10-nam-hyundai-but-pha-tai-vn-va-tham-vong-xuat-xuong-200000-xenam-
post965150.html
[Accessed 15 1 2020]
notesmatic,2018. notesmatic. [Online]
https://notesmatic.com/hyundai-five-forces-analysis/
[Accessed 15 1 2020]

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otoday,2018. otoday. [Online]
https://www.otoday.vn/threads/nhung-doi-thu-cua-hyundai-kona-2018.488/
[Accessed 15 1 2020]
vietnamfinance,2018. vietnamfinance. [Online]
https://vietnamfinance.vn/xe-ban-chay-nhat-cua-tc-motor-tuong-dai-hyundai-accent-
20180504224232369.htm
[Accessed 15 1 2020]
seprianhidayatamin,2018. seprianhidayatamin. [Online]
https://seprianhidayatamin.wordpress.com/2016/04/23/7-the-three-levels-of-strategy/
[Accessed 15 1 2020]

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