In a bombshell claim delivered at the Genesis Magma launch in France, Hyundai Motor Company CEO Jose Muñoz has declared the Korean automotive giant has overtaken the Volkswagen Group to become the second-most profitable automaker in the world.
While Toyota remains the undisputed king of global sales and profits, the battle for second place has been fierce.
Speaking to media, Mr Muñoz didn’t mince words about the shifting hierarchy of the automotive world.
“We have become, already, several years in a row, the number three global OEM [by sales]. And in fact, when you consider profits, we are number two,” Mr Muñoz said.
“So we just overtook Volkswagen very recently.”
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Mr Muñoz attributed the surge in profitability to what he calls the “Power of the Group” – the vertical integration that allows Hyundai to control its own destiny in ways other car makers can’t.
“One of the key success factors of the group is what we call inside the ‘Power of the Group’. The group is comprised of more than 50 different entities that work all aligned,” he said.
He pointed to the group’s ownership of Boston Dynamics (robotics) and Supernal (electric vertical take-off aircraft) as examples of tech leadership, but the real cash cow remains the core automotive business.
While Mr Muñoz acknowledged that profits had been “dented by tariffs” (likely referring to the US market complexity), he noted that Hyundai “lost about 30 per cent compared to last year” in some metrics while competitors were seeing “70 per cent and more profit loss.”
This claim highlights the diverging fortunes of the two giants. Volkswagen Group is currently mired in a cost-cutting crisis, threatening factory closures in Germany and battling software delays.
Meanwhile, Hyundai and Kia are posting record revenues, driven by a flexible platform strategy that has allowed them to pivot between electric vehicles (EVs) and hybrids faster than almost anyone else.
It also explains how Genesis has the cash to launch a wildly ambitious high-performance sub-brand like Magma while other luxury brands are tightening their belts. When the parent company is making money hand over fist, you can afford to build 478kW orange drift cars.