April 19, 2024

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[THE INVESTOR]  Hyundai Motor Group is expected to put off its annual year-end reshuffle of top executives to next year amid deepening probe into the presidential scandal that rocked the nation.

Hyundai Motor’s management shakeup was expected to announced on Dec. 26-28. But due to the ongoing scandal that brought some of Hyundai’s top brass to the prosecution, the automaker is considering to postpone the reshuffle for the time being, according to industry sources. 

It will be the first time for Hyundai to delay its annual December event in 10 years after it was under a probe by prosecution for a slush fund scandal in 2006.

Hyundai is under investigation for giving major advertisement deals worth billions of won to a PR firm owned by Choi Soon-sil, a close friend of impeached President Park Geun-hye.

Separately, the automaker, as well as other top conglomerates, are accused of donating billions of won to shady foundations set up by Choi using her presidential ties, in exchange for business favors. Hyundai allegedly donated 12.8 billion won (US$10.64 million), the second largest amount after Samsung Group, which offered 20.4 billion won.

This year’s executive reshuffle may be downsized from a year earlier, industry watchers say, as the nation’s largest automaker suffered declining sales weighed by the labor strike, natural disaster and protracted economic slump. Last year, Hyundai promoted 368 staff at the executive level, down by 15 percent from 2015.

Hyundai Motor and Kia Motors’ combined sales is expected to stand below 8 million units this year, falling short of its annual target of 8.13 million units, and also below last year’s figure of 8.01 million units. It would be the first time the auto giant has experienced an annual decline in global sales since the 1997-98 Asian financial crisis.

By Ahn Sung-mi (sahn@heraldcorp.com)