According to media reports, Korean automakers Hyundai and Kia may benefit from the scandal involving Toyota. Recently, automotive industry executives and experts have indicated that with the damaged corporate image of the Japanese automaker, consumer demand for Korean cars could increase, especially in emerging markets like India and Southeast Asia.
Toyota recently apologized for cheating on certification tests for seven models. In January this year, Toyota also faced criticism for falsifying data in diesel engine certification tests for ten models.
Industry insiders suggest that being embroiled in such scandals repeatedly will severely damage Toyota's solid image as the world's top-selling automaker. They predict that Hyundai Motor Group will benefit from Toyota's scandal in key markets.
Lee Ho-geun, a professor of automotive engineering at Daedeok University in South Korea, stated, "Following the latest Toyota scandal, Korean automakers will attract more customer attention in major markets such as India and Southeast Asia. In 2011, when Japan was hit by a massive earthquake and tsunami, leading Japanese automakers, including Toyota, suffered due to supply chain disruptions. At that time, Volkswagen benefited the most from the production cuts of its Japanese counterparts."
Lee noted that with increased global market recognition, Hyundai Motor Group would be able to further boost its sales and reinforce its image as a more reliable automaker.
Although Toyota is still considered an unrivaled leader in terms of sales, Hyundai and Kia are narrowing the gap by targeting emerging markets. Data from the Vietnam Automobile Manufacturers Association shows that Hyundai topped the country's car sales in 2023, surpassing Toyota by about 10,000 units.
An executive from an automaker stated that Hyundai Motor Group would be the biggest beneficiary of the Toyota scandal because Hyundai is also rooted in the Asian region and has been rapidly becoming a strong global competitor due to its significant sales growth over the past decade.
Automotive industry executives believe that Hyundai Motor Group is expected to further consolidate its position as one of the world's top three automakers. By sales volume, Hyundai Motor Group is the third best-selling automaker globally, trailing only Toyota and Volkswagen.
These executives added that Hyundai is also vigorously developing electric vehicles and striving to reshape its position as a software-driven automaker. Toyota's involvement in such scandals presents Hyundai and Kia with an opportunity to enhance their global image during this industry transition. As a result, Hyundai achieved an operating profit margin of 10.4% in the first quarter, ranking among the top of all global automakers.
