A Research Report on the Change in Global Auto Industry (X)

3.  Volkswagen and Hyundai may seize the chance for global expansion

The crisis has relative winners -- that is to say, some mainstream automakers have relatively suffered little from the impact of the crisis. Our survey shows that the influence of the crisis on Volkswagen and Hyundai is mainly positive as their brand images have been enhanced. The profits of global automakers in the first quarter show that the profits or losses of Volkswagen and Hyundai are much better than the industry average. This is supported by the findings.

The two automakers that have relatively benefited from the crisis will likely seize the opportunity to rapidly expand their territories in the auto industry, specifically as follows:

① In this round of crisis, Volkswagen is the main beneficiary of its two major markets, namely the Western European market (particularly in Germany) and the Chinese market, where the company's sales had not posted any significant decline. Volkswagen's dependence on the U.S. market is very small, which is different from Toyota Motor.

② In addition to consolidating its leading position in the Chinese market, Volkswagen will increase its investment in the U.S. market (VW built a new plant in the U.S. in 2008). It is a rare opportunity for VW to expand its American market share while the Big Three in North America and Toyota are undergoing adjustment.

③ However, Volkswagen is not in the leading league of new-energy vehicle makers. If it makes no substantive progress in this field, Volkswagen will have difficulty improving in the later stage of the two-year period of opportunities. Volkswagen's partnership with China's BYD for making the new-energy vehicles is more like a marketing strategy than any substantive progress.

④ It is a big surprise that Hyundai Motor has benefited from this crisis, because Hyundai's reliance on the U.S. market was also quite high. The industry's mainstream opinion was that the won value dropped sharply against the U.S. dollar by as much as 50%, and Hyundai Motor had good marketing strategy in the U.S. market -- these are the two main causes for Hyundai's escape from the damage.

⑤ Hyundai Motor will continue to use the depreciation of its country's currency as an opportunity for expansion in the U.S. and Chinese markets. Of course, its marketing strategy in the United States will be subject to imitation and may be unlikely to maintain long-term advantages, and if the value of won rises gradually, the competitive advantages of Hyundai Motor will also be hard to retain. Therefore, it is difficult to predict how fast Hyundai Motor will expand in the coming two years.

(To be continued)

A Research Report on the Change in Global Auto Industry (I)

A Research Report on the Change in Global Auto Industry (II)

A Research Report on the Change in Global Auto Industry (III)

A Research Report on the Change in Global Auto Industry (IV)

A Research Report on the Change in Global Auto Industry (V)

A Research Report on the Change in Global Auto Industry (VI)

A Research Report on the Change in Global Auto Industry (VII)

A Research Report on the Change in Global Auto Industry (VIII)

A Research Report on the Change in Global Auto Industry (IX)

A Research Report on the Change in Global Auto Industry (XI)

A Research Report on the Change in Global Auto Industry (XII)

A Research Report on the Change in Global Auto Industry (XIII)

A Research Report on the Change in Global Auto Industry (XIV)

A Research Report on the Change in Global Auto Industry (XV)

A Research Report on the Change in Global Auto Industry (XVI)

A Research Report on the Change in Global Auto Industry (XVII)