Monday, December 30, 2013

Editorial: What John Krafcik's depature means for Hyundai

Image courtesy of Automobile Magazine
If you have not heard the news already, a big shake-up is taking place in the automotive world - John Krafcik, the leader of Hyundai's operations in the US and considered one of the more visionary leaders among major automakers, is stepping down come January 1. Krafcik's tenure at Hyundai saw the Korean automaker go from selling mediocre cars that competed by selling for a lot less to a truly global automaker that now produces cars that are not only competitive, but downright world-class and in some cases, are class-leading. This kind of total image shift is something that few automakers have managed successfully and fewer still have managed so effortlessly as Hyundai has with Krafcik at the helm.

Krafcik has overseen the launch of the wildly popular Sonata and the transition of the Genesis sedan from a home market only vehicle to a truly global product. A completely redesigned Elantra has made huge waves in the compact car market by showing the world that cheap does not mean you cannot have a little style. And the funky Veloster redefined the subcompact segment with its unconventional looks and door arrangement. To be fair, it hasn't been all favorable. In fact, Hyundai just recently settled with owners of various models for overstating EPA fuel economy figures that most drivers found unattainable.

Still, his legacy will be one of a tremendous image re-branding that took even the Japanese and German automakers by surprise. And that also means that there is going to be a massive pair of shoes to fill upon his departure. Hyundai will need to find a leader who is capable of continuing to grow the company's popularity with buyers while not losing sight of the overall direction what the brand hopes to achieve. The worst thing possible would be for Hyundai to become like Volkswagen, which finds itself locked in the US to a conventional non-luxury status and, as a result, was never able to successfully market a car like the Phaeton, essentially a discounted Audi A8 with a VW badge. Hyundai is already starting see some of the challenges that it faces trying to move upmarket. The Equus, a car that we tested earlier this year and enjoyed for its many charms, struggles to find a place in the luxury market despite costing just a fraction of the price of similarly equipped competitors.

So the selection of a permanent replacement for Krafcik will be a serious challenge for the board at Hyundai. The first few months for the new leader will be telling in how they envision the company growing and what it aspires to be in the marketplace. We watch from our armchairs with bated breath as if watching an auto race, both hoping to see a good outcome, but also secretly waiting for that massive wreck that we cannot look away from.

All we know for sure is that without the work of John Krafcik, Hyundai would not be where it is today and the automotive marketplace is a much better place because of the efforts of the people at Hyundai under his leadership.