Chairman Chung Mong-hyuk’s “10 Years of Independent Management”
Annual sales exceed 200 billion won for the first time
Brand business becomes a cash cow… doubling in size over 5 years
Applying ‘HYUNDAI’ brand to outsourced home appliances
TVs and refrigerators sold in 160 countries
Chairman Chung accelerates growth through new business ventures
Acquisition of automotive parts companies planned within the year
Home appliances sold under the ‘HYUNDAI’ brand by Hyundai Corporation Holdings are gaining significant popularity overseas. Visitors explore the Hyundai Electronics booth at ‘IFA 2023,’ Europe’s largest international consumer electronics exhibition. / Provided by Hyundai Corporation Holdings
Home appliances sold under the ‘HYUNDAI’ brand by Hyundai Corporation Holdings are gaining significant popularity overseas. In the Colombian TV market last year, the brand that ranked third in market share (13.2%)—following Samsung (24.7%) and LG (17.4%)—was ‘Hyundai Electronics,’ a name that technically vanished from the home appliance market after the 1990s.
Beyond Colombia, home appliances like TVs are being sold under the ‘HYUNDAI’ brand across South America, Southeast Asia, and Eastern Europe.
The secret lies in the brand business of Hyundai Corporation Holdings. Acting as a general trading company for the Hyundai family group, the company chose to lease its brand to overseas manufacturers or engage in Original Equipment Manufacturing (OEM) as its new growth engine. With these appliances gaining popularity in approximately 160 countries, the company achieved record-breaking sales last year. It now aims to use the profits generated here to venture directly into the manufacturing sector.
■ Brand Royalty Revenue Doubles in 5 Years
This performance is driven by the brand (trademark) business. Last year, the brand business accounted for 26.1% (KRW 56.4 billion) of total sales, roughly doubling from 12.8% (KRW 23.6 billion) in 2019. With an operating profit margin reaching 41.0% (KRW 23.1 billion), it is creating a stable cash flow for the group.
The company designated brand business as a new venture in 2007. Hyundai Electronics, which previously manufactured appliances, exited the business in 2001 after changing its name to Hynix Semiconductor (now SK Hynix) due to industrial restructuring and debt workouts.
Recognizing that the ‘Hyundai’ brand remained globally influential through Hyundai Motor, Hyundai Engineering & Construction, and Hyundai Heavy Industries, the company acquired the ‘Hyundai’ trademark for electronics and ICT products from Hynix in 2007. Although the trademark was sold to Hyundai Heavy Industries (now HD Hyundai) for KRW 107.6 billion in 2019, the company secured a 30-year usage right by paying KRW 94.3 billion in rent to continue the business.
■ Expanding OEM and Entering Manufacturing
2Hyundai Corporation Holdings, which spun off from Hyundai Corporation in 2015, has further expanded its brand business. Building on its success, it is now growing its OEM business, where it commissions overseas manufacturers to produce appliances and sells them under its own brand. The company plans to increase the share of OEM sales—currently around 10% of brand revenue—and expand into regions like Africa.
Most OEM partners are located in China, as the company determined it is difficult to compete with Chinese firms in terms of quality and price for basic appliances. A company official stated, “Younger generations in emerging markets prefer products that are affordable yet of decent quality. We select Chinese manufacturers with proven export records and conduct rigorous quality inspections”. These home appliances, including TVs and refrigerators, are sold under the Hyundai brand in approximately 160 countries worldwide as ‘Hyundai Electronics’ products—a brand that no longer exists in Korea.
■ ‘10 Years of Persistence’ of Chairman Chung Mong-hyuk
While the brand business’s total revenue scale is not massive, it generates approximately 30 billion won in profit annually, which the company intends to use as “ammunition” for business diversification.
The primary target is entering the manufacturing industry. The company is currently pursuing the acquisition of an automotive parts manufacturer by the end of this year. The target is a domestic supplier for Hyundai Motor Group, with an acquisition price estimated at around KRW 60 billion. Having already entered the sector in 2021 by establishing joint ventures with domestic and foreign automotive parts companies in regions such as Russia and Indonesia, the company is now making a full-scale move into the automotive parts business. Chairman Chung Mong-hyuk, who has consistently emphasized the discovery of new businesses, set “management rights acquisition” as this year’s business goal.
Along with the holding company, Hyundai Corporation also recorded all-time high sales of KRW 6.9957 trillion last year. Since 2021, its sales and operating profit have grown at an impressive annual average rate of 23% and 56%, respectively. Analysts suggest that Chairman Chung’s “10th year of independent management” since separating from Hyundai Heavy Industries is finally bearing fruit.
June 6, 2025
The Korea Economic Daily