PESTLE Analysis of Hyundai
Hyundai is one of the most popular car makers manufacturing vehicles for every customer segment. The company has an extensive product portfolio from small cars to SUVs and luxury vehicles. Everyone loves Hyundai due to its advanced manufacturing and unique designs. Read the PESTLE Analysis of Hyundai.
Currently, the company is trying to manufacture eco-friendly vehicles like electric cars. The strong market of Hyundai is in Asia, and its models such as i10, 120, and Sonata are very famous all over the world. In American markets, Santa Fe and Elantra have been doing well. As a result, the company’s revenue and reach are increasing rapidly.
To analyze the business tactics of any company, PESTLE is the best tool as it helps to investigate several external factors such as political, economic, social, technological, legal, and environmental. The impact of these factors is really huge on any business. This PESTLE analysis highlights the external factors of Hyundai, a leading automaker globally.
Political Factors – PESTLE Analysis of Hyundai
There are plenty of car brands globally, and Hyundai is one of them with a global presence and loyal customer base. The political scenario of the world has made the business environment more complex. Establishing business worldwide needs unique tactics such as government rules, an unstable political environment, and heavy taxes. This kind of business environment can create supply chain disruption, manufacturing issues, and sales problems. So, Hyundai can’t take political forces for granted or easily because they are responsible for the better growth of its business. The business of Hyundai spreads across geographies. The political stability in the Asian-Pacific market creates a wonderful growth opportunity for Hyundai. It is a great trading indicator for the company.
Moreover, the relations of South Korea with other countries also predict which country is suitable to invest in. Unfavorable relations or conditions can lead to many problems like strict regulations and higher taxes. As a global brand, the change in the governments can also hurt the working of Hyundai.
Read Also: COMPLETE SWOT ANALYSIS OF HYUNDAI MOTOR COMPANY – 2022
Economic Factors – PESTLE Analysis of Hyundai
The ups and downs in businesses are common but constant slowdown is not favorable for any company. India is one of the most prominent markets and its current economic situation is not so favorable for the company. More than 350000 people have lost their job recently. Economic factor has a direct impact on any business and they can affect the business globally. These days, the world’s economic situation is unpredictable due to the impact of COVID-19, recession, and unemployment. This thing has decreased the demand for new cars and luxury cars, impacting all automotive brands. The customer’s buying power is really limited, and they prefer to use public transport instead of buying their own car. That is why the demand for SUVs and big vehicles has increased.
Moreover, Hyundai should increase its US and Japanese market presence to increase its revenue and profit. Other automotive brands are trying to make conditions favorable by offering exciting schemes and discounts. On the other hand, Hyundai is doing fine in India’s car sales department. It is only because of its unique features and striking designs. Even though Hyundai is a latecomer in the SUV space, they have gained significant popularity and market share. By creating job opportunities in India, Hyundai can produce cost-effective vehicles because of the cheap labor.
Social Factors – PESTLE Analysis of Hyundai
The number of male and female drivers in the world is nearly the same (60:40). Hyundai can manufacture vehicles suitable for both sexes. By customizing its cars, the company can fulfill the requirements of customers. That is why the company mainly targets middle and upper-class people. The company offers every type of car with the cost ranging from 6000 to 35000 dollars. Social factors are a game-changer for any business if they utilize them properly. Hyundai can easily target new customers by understanding the customer’s requirements, preferences, and cultural norms.
For example, the demand for SUVs is rising globally, so Hyundai can benefit from this trend by manufacturing affordable and durable SUVs. So, we can say that social trends play a big role in the working of any business. It is crucial to make strategies according to the latest trends to hit the customers rightly. This thing provides a great chance for long-term stability.
Read Also: HYUNDAI MOTORS MARKETING | HYUNDAI MARKETING STRATEGY
Technological Factors – PESTLE Analysis of Hyundai
In order to reduce carbon footprint and to increase fuel efficiency, the company uses Gasoline Direct Injection (GDI) technology. But, Hyundai’s cars provide less mileage. Due to this reason, Maruti Suzuki is giving a tough competition to Hyundai in India. Moreover, many automotive companies are focusing on Artificial Intelligence (AI) to gain a competitive edge. The company should invest in this factor to have a unique advantage. In the 21st century, people are really tech-savvy and prefer to use advanced and highly innovative products.
They judge every feature before buying cars. Hyundai should introduce technological enhancement in its products to gain the attention of customers because the competition is really high in the automotive sector. They must invest in research and development to produce quirky designs and cars. When it comes to R&D investment, the company is really strong because they invested 2352 billion Korean WON in 2016 just for R&D purposes. This kind of investment helps the company get a competitive edge over other automotive brands, and they can create a stable business environment by gaining users’ trust.
Legal Factors – PESTLE Analysis of Hyundai
In order to protect Intellectual Property Rights (IPR), every country has strict laws and rules. It involves the trademarks, copyrights, and filing of patents. That’s why the Indian market is the most favorable market for Hyundai. Also, the country’s discrimination laws are stringent, so it is a good indicator for investors. This thing ensures a good working environment for the companies as well as for the people. In case of any breach or rule break, a company can face hefty fines that are not good for its reputation. By following labor laws, environmental laws, and areas laws, Hyundai can win the trust of customers and remain competitive. It is not only good for the company but also for the environment. Isn’t it a win-win strategy? Hyundai should not be involved in any controversy or lawsuit because these things are enough to break the company’s repo.
Environmental Factors – PESTLE Analysis of Hyundai
For Hyundai and other car companies, environmental initiatives are their main focus. Nearly every car runs on fuel, so it is hard to control emissions. Hyundai and other automotive brands must meet emission standards and ethical working. Unethical practices and other negative news can tarnish the company’s image globally, which will directly affect its revenue. As people are more eco-friendly, they support every act of sustainability. So, Hyundai can impress eco-conscious users by reducing its carbon emission and sustainable practices. Every country has created environment-related rules or laws, creating considerable pressure on the companies like Hyundai. Hybrid cars and electric vehicles are the only way to impress the people and governments.
Summary
PESTLE Analysis of Hyundai
We live in an advanced era where technological, political, and economic factors matter a lot. Financial uncertainty can disrupt the operational structure of any company. Fluctuating currency rates is another problem for companies like Hyundai who are operating internationally. It is essential to follow environmental rules and tackle legal factors intelligently to keep your business away from any scandal. A friendly political and economic environment is suitable for enhancing growth, revenue, and net profit.
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