Hyundai Motor · PDF fileSales Growth and Diversified ... Portion of Exports from Korea Plant OP Margin & KRW/USD Exchange Rate Trend Source: Company data * Hyundai

Hyundai Motor CompanyInvestor Presentation August 2013

1

Table of Contents

1. Executive Summary

2. Key Strengths for HMC

3. Future Strategies

4. Market Update by Region

Appendix

1. Executive Summary

3

Executive Summary

Balanced Sales Growth

and Diversified Portfolio

Strong Performance

through the Cycle

Structural Improvement in

Core Competitiveness

Superior Performance Relative to

Peer Groups

Volume Growth

Value Growth

Cost StructureImprovement

Green Car

Current Outstanding Performance Prudent Future Strategies

2. Key Strengths for HMC

5

Strong Performance Through the Cycle

3.9%4.0%

5.1% 5.1%

5.4%

5.7%

2007 2008 2009 2010 2011 2012

7.3% 6.3%

-7.4%

6.6% 8.1% 11%9.2% 8.8%

-5.0%

9.3%

19.3% 24%

2007 2008 2009 2010 2011 2012

Automaker Value Growth HMC Value Growth

2,603 2,6543,239

3,7014,099

4,392

2007 2008 2009 2010 2011 2012

Steady Growth in Global Sales1

(Unit:: 1,000 vehicles)… and Strengthening Global Market Share

1. Retail sales excluding CKD sales2. Interbrand

1

Supported by Relatively Higher Brand value Growth2

than the Industry… and Improving Residual Value of Vehicles

+7.1%

61.7%

45.8%

39.4%

59.8%

59.5%

46.5%

35%

45%

55%

65%

'08 MY '09 MY '10 MY '11 MY '12 MY '13MY

Elantra Sonata Santa Fe

6

Balanced Sales Growth through Global Manufacturing Plants

(Unit: 1,000 vehicles)2012 July (YTD) 2013 July (YTD)

Turkey PlantIndia PlantChina PlantUS Plant Czech Plant Russia Plant

US

427419

Korea

384388

EU

244266

Middle East and Africa

298299

India

207215

China

572427

LatAm

210143

Worldwide (YTD)

’12 July ‘13 July

2,495 2,683

7 manufacturing plants ( ), 6 R&D facilities ( ), 14 direct sales subsidiaries ( ), sales in more than 190 countries globally

Source: Company data (Retail sales excluding CKD sales)

2

Brazil Plant

+47%

+7.5%

-0.8%

+34%-8.3%

-3.9%

-0.2%

+2.0%

7

Geographically Diversified Portfolio (%)

Balanced Sales Growth by Diversified Business Portfolio

Marketable Product Mix2 (%)

10.9

27.9

31.5

17.5

15.3

18.5

28.2

27.5

14.1 8.2

42.2

25.4

5.0

30.9

25.8

18.0

6.4

46.7

0 20 40 60 80 100

Honda

Toyota

Fiat

VW

Domestic North America Europe Asia Others

1

Source: Company data for HMC 2012 Global Retail Sales, Competitor information from public filings (2012FY Earnings Results)1. Others include 38.0% of Brazil sales2. A+B+C=Compact+Sub-Compact+Mini; D+E+F=Mid-Size+Large+Luxury; RV=SUV+MPV, Others=PUP and others

2

18.9 31.416.7 14.6 18.4Hyundai

1.5

24.0

6.2

45.9

40.1

70.9

61.6

1.2

19.4

18.5

15.6 31.1

34.1

12.8

3.9

13.2

0 20 40 60 80 100

Honda

Toyota

Fiat

VW

A+B+C D+E+F RV Others

18.3 7.555.3 18.9Hyundai

88

Structural Improvement in Core CompetitivenessEnhanced Brand Value is leading sales growth and reduce incentive spending. Subsequently, reduction in incentive is resulting ASP increase and repeated Brand Value improvement.

Source: Auto data/PIN Data, ASP based on actual transaction prices

Structural Improvement

EnhancedBrand Value Sales Growth Reduction in

Incentives ASP Increase

Structural Improvement from US Market

ASP (Sonata, $)

(%)

18,266 3.9

18,019 (1.4)

21,821 21.1

23,148 6.0

22,700 (2.4)

Sales (‘000) M/S (%)

(%) (%pt)

401 (14.0) 3.0 0.1

435 8.3 4.2 1.2

538 23.7 4.6 0.4

646 20.0 5.1 0.5

703 8.8 4.9 (0.2)

US Market Brand Value($ in Billion)

2008 4.8

2009 4.6

2010 5.0

2011 6.0

2012 7.5

Incentive (PNVS, $)

(%)

2,194 20.7

2,506 14.2

1,649 (34.1)

1,005 (39.1)

946 (5.9)

9

3.9%

6.1%

8.8%

10.3% 10.0% 9.6%

1102.6

1,276.4

1,156.3

1,108.1 1,126.9

1,103.3

2008 2009 2010 2011 2012 2013 1H

HMC OP Margin KRW/USD Avg.

Increased Resilience to FX FluctuationsHMC has reduced its exposure to FX fluctuations and made efforts to reduce risk from FX fluctuations

Portion of Exports from Korea Plant OP Margin & KRW/USD Exchange Rate Trend

Source: Company data* Hyundai OP margin for 2008-2009 based on K-GAAP, 2010–2012 based on K-IFRS

(Unit: KRW/USD)

52%59% 59% 60%

71% 70% 70% 72% 75%

48%41% 41% 40%

29% 30% 30% 28% 25%

2005 2006 2007 2008 2009 2010 2011 2012 2013 1H

Korea Domestic & Overseas Plant Sales Export from Korea Plant

3

HMC has implemented hedging, settlement currency diversification and improving export ASP to mitigate impact from FX

10

4,846 4,604 5,0336,005

7,50072

6965

6153

2008 2009 2010 2011 2012

Brand Enhancement

Source: Interbrand, JD Power

Enhancement in Brand Value

US Customer Retention Rate

(Ranks)

(Ranks)(Unit: US$ in Millions)

+9.3%+19.3%

47.0% 47.0%

60.0% 64.0%1311

3 1

2009 2010 2011 2012

3

Highest growth rate among automakers for two consecutive years

In US market, Hyundai achieved the highest retention rate among competitors in 2012

+13.0%p

+4.0%p

Awards and Accolades

+24.9%Date Award Title Region Model(s)

2013.02 ’13 Car of the Year Canada Santafe

2013.02 Rank 1st in VDS mid-size segment U.S. Sonata

2013.01 Future Auto Award 2013 Germany Ix35 FCEV

2012.11 Car of the Year 2013 Brazil HB20

2012.08 Car Buyer Car of the Year 2012 U.K. i30

2012.07 Company Car of the Year Germany i40

2012.04 Car of the Year Russia Solaris

2012.03 Best Auto 2011 Russia Solaris

2012.03 Best Value in America U.S. Accent, Elantra, Coupe and Tucson

2012.02 Car of the Year U.K. i30

2012.02 Carmaker of the Year U.K. Hyundai

2012.01 Car of the Year China Sonata

2012.01 ‘12 N. American Car of the Year U.S. Elantra

2011.12 Family Car of the Year Germany ix20

2011.04 Car of the Year Russia ix35

11

Utilization & InventoryHigh global utilization and low inventory level enables the company to promote value pricing strategy.

HMC Global Utilization Trend HMC Global/US Inventory Trend

Source: Company data/US Autodata

(Unit: %) (Unit: Month of Supply)

1

2

3

4

Jul-10 Dec-10 May-11 Oct-11 Mar-12 Aug-12 Jan-13 Jun-13

Overseas Inventory US Inventory

89.9 91.5

100.6

107.4108.4

105.6

2008 2009 2010 2011 2012 2013 1H

3

12

Value Pricing StrategyWith value pricing strategy, ASP is keep improving while incentive spending is decreasing.

Average Selling Price (ASP) by Export Market US Incentive Trend(Unit: USD 1,000) (Unit: USD)

Source: Company Data, US Autodata, ASP is based on HMC headquarter results

6

8

10

12

14

16

18

2002 2004 2006 2008 2010 2012

LatAm Middle East and Africa Asia Pacific Total Export

Export ASP CAGR: +6.0%

US$15,000

3

2,427

946

865

1,804

872

2,206

600

1,000

1,400

1,800

2,200

2,600

2006 2007 2008 2009 2010 2011 2012

Hyundai Toyota Honda

13

6.1%

-3.7%

-0.2%

1.8%

0.0%

-3.0%

8.8%

2.6%

6.9%

5.6%6.2%

5.2%

10.3%

0.9%2.1%

7.1%

5.7%5.1%

10%

4.8%5.5%

6.0%4.9%

6.3%

9.6% 9.6%

5.8% 5.9% 5.5%6.4%

Consistent Profitability Relative to PeersHMC has shown the most consistent operating performance relative to competitors during the past few years.

Source: Public FilingsNote: Based on Consolidated Financials, Calendarized Financials for Japanese Firms* Hyundai Financials for 2009 based on K-GAAP, 2010–2012 based on K-IFRS

2009 2010 2011 2012

Consolidated Operating Margin Trend

4

2013 1H

3. Future Strategies

15

Sustainable Success Going Forward

Key Strategy for Ongoing Growth in Earnings

Consistent revenue growth and enhanced profitability to be achieved through structural improvement in product/brand value, balanced capacity expansion and cost structure improvement

Volume Growth

Balanced Capacity Expansion and

New Model Launch

Value Growth

Higher ASP and Lower Incentive Driven by

Enhanced Product and Brand Value

Cost Structure Improvement

Higher Cost Competitiveness fromVertical Integration

Green Car

Develop Independent and Distinctive Technology

16

Value Growth – Product CompetitivenessElantra, Sonata, and Santa Fe are experiencing high demand with better specification.

Specification Comparison

Elantra (Compact Sedan)

Sonata (Mid-size Sedan)

Santa Fe (Compact CUV)

1

Specification Hyundai Elantra (’11) Toyota Corolla (’09) Honda Civic (’12)

Displacement 1.8L 1.8L 1.8L

Max. Power 148@6,500 132@6,000 140@6,300

Mileage 28mpg / 38mpg 26mpg / 34mpg 28mpg / 39mpg

Specification Hyundai Sonata (’10) Toyota Camry (’12) Nissan Altima (’13)


Max. Power 198@6,300 178@6,000 182@6,000


Specification Hyundai Santa Fe (’13) Toyota RAV4 (’13) Chevrolet Equinox (’10)


Max. Power 190@6,300 179@6,000 182@6,700


Source: Company Data

17

Value Growth - Higher ASPTransaction price of major models in US market has improved with structural improvement.

Source: PIN data (Annual average transaction price in US market)

Transaction Price Trend in US Market

Compact Sedan(Unit: USD 1,000)

Mid-size Sedan Compact CUV

26.5

22.3

22.6

23.7

25.4

23.5

2009 2010 2011 2012

Santa Fe RAV4 Equinox

23.5

22.7

23.1

17.6

21.1

22.421.6

22.8

2007 2008 2009 2010 2011 2012

Sonata Camry Accord

19.9

18.0

18.9

15.5

19.6

17.8

15.8

19.318.6

2007 2008 2009 2010 2011 2012

Elantra Corolla Civic

4-Cyl, 2WD

18

Volume GrowthHMC’s global sales will be increased with capacity expansion and by maintaining high utilization rate.

Capacity Expansion and Sales Plan

Source: Company data* Above sales figures are based on shipment** BHMC : Beijing-Hyundai Motor Company / CHMC : Sichuan-Hyundai Motor Company

Production Capacity Expansion Sales Plan by Plants

(Unit: 1,000 Vehicles) 2012 2013 (P) 2014 (P) Chg (%) 2012 2013 (P) Chg (%)

Korea 1,870 1,870 1,870 0.0 1,911 1,850 -3.2

US 300 370 370 0.0 361 388 +7.4

China (BHMC) 900 900 1,050 +16.7 856 970 +13.3

India 600 600 600 0.0 641 633 -1.3

Turkey 100 200 200 0.0 86 89 +3.6

Czech 300 300 300 0.0 303 300 -1.0

Russia 200 200 200 0.0 225 220 -2.0

Brazil 150 150 170 +13.3 27 150 +452.1

China (CHMC) – 60 150 +150.0 – 60 –

Overseas 2,550 2,780 3,040 +9.4 2,499 2,810 +12.4

Total 4,420 4,650 4,910 +5.6 4,410 4,660 +5.7

2

19

Cost Structure Improvement (Platform Integration)Platform integration will reduce development cost and realize greater economies of scale per platform.

Platform IntegrationIntegration Schedule Reduction of Model Development Time

No. of Models per Type of Platform Increasing portion of models with integrated platform

2002 2009 2011 2013 (P)

Integrated Platforms 0 6 6 6

Total No. of Platforms 22 18 11 6

Total No. of Models 28 32 36 40

Avg. of 40 months → 19 months40

33

19

2002 2009 2013

Source: Company Data

Small Mid-size Large Coupe Frame SUV LCV

Mass Production Niche Market

New81%

Old19%

2011 2013 (P)2012

3

New62%

Old38%

New75%

Old25%

20

Green CarHMC independently developed and obtained distinctive technology on HEV system.

Developing Green Cars: HEV

Hybrid Vehicle Strategy Hybrid Vehicle

HEV Performance Comparison

Sonata HEV

Displacement: 2.4ℓ

Max. Power: 206 hp

Mileage: 34 / 40 mpg

Commercial production: 2011 (US & Korea)

Source: Company data

4

A “Fast Second Company” - strategy to quickly become a # 2 player by competing with industry leading players

Gradual expansion of HEV applied automotives (mid-size, SUV, heavy vehicles)

Enhancing fuel efficiency

Focusing on HEV system improvement and obtaining distinctive components technology

Specification Sonata HEV Camry HEV Altima HEV

System Power 206 hp 200 hp 198 hp

Battery Li-PB 34kW Ni-MH 33kW Ni-MH 30kW

Mileage (City/Highway) 36mpg / 40mpg 43mpg / 39mpg 35mpg / 33mpg

Motor 30kW (40.2hp) 105kW (141hp) 105kW (141hp)

System Parallel System Power Split System Power Split System

21

Green CarHMC has been chosen to participate in European FCEV demonstration program together with Daimler.

Developing Green Cars: FCEV

Fuel Cell Electric Vehicle FCEV Vehicle

Development Roadmap Assessment of Light-duty FCEV Manufacturers

Tucson ix FCEV

Max. distance: 650 km

Max. speed: 160 km/h

Fuel Efficiency: 31km/ℓ

Commercial production: TBD

Phase 1 (~2006)— Develop

Stack Technology

Phase 2 (2007~2011)— Improve

Performance

Phase 3 (2012~)— Commence

Small Production

Santa Fe FCEV

Tucson FCEV

Fuel Cell Electric Bus

Tucson FCEV (2nd Gen.)

Mohave FCEV

Fuel Cell Electric Bus (2nd Gen.)

Tucson ix FCEV

Source: Company data, Pike Research (August 10, 2011)

69.9 66.7 66.1 65.1

54.4

43.936.8

Daimler Honda Toyota HMC GM Nissan Ford

4

Assuring “FCEV Leading Maker” position by demonstration program

Commenced production of 1,000 vehicles from 2013 to 2015

Mass production technology in process through independently developed “FCEV Stack Technology”

4. Market Update by Region

23

Korea

Source: KAMA, Company data

Sales and M/S Trend (Retail Sales)(Unit: 1,000 vehicles)

1,464 1,474 1,411 1,380

45.0%46.4% 47.3% 47.9%

2010 2011 2012 2013 July

Industry M/S

161 170 162 78

226 250 231

129

94 77 112

82

177 185 162

96

2010 2011 2012 2013 JulyCV RV Med + Large PC Small PC

658682 667

385

Market Strategy

New Model Launch

Maxcruse_Santa Fe Long body (Feb 2013) : Enhance sales volume and model mix with diversifying SUV model

Avante F/L (Aug 2013) : Add Diesel models to improve competitiveness with the imported vehicles

Genesis (2H 2013) : Targeting luxury market with all new model to improve profitability and brand

Corresponding Measures on Increase of Imported Vehicle

Enhanced Credibility

ImprovePremium Image

Expand Diesel Line-up

Test drive for comparison with imported model

Develop options for domestic customers

Diversify product line up and Power train

Upgrade and expand sales/service network

Enhasing Diesel Line-up like Avante and Grandeur in domestic market to improve competitiveness

(‘13 P)

24

United States

Source: Company data


11,590 12,778

14,492 15,340

4.6%5.1% 4.9% 4.7%

2010 2011 2012 2013 July

Industry M/S

184251 298

203

229

264 277

150

125

131128

74

2010 2011 2012 2013 JulyRV Med + Large PC Small PC

538

646

703

427

Market Strategy

Face Lift Model Launch Equus (March 2013) / Elantra (2H 2013): Enhance Premium

segment volume to improve brand image and keep strong sales trend in non-premium segment by Face lift model

Premium PC Sales

(‘13 P)

25

China

Source: Company data* Market demand based on Passenger Vehicle


11,12011,935 12,620

13,850

6.3% 6.2% 6.7% 7.1%

2010 2011 2012 2013 July

Industry M/S

519 472567

363

65 113

117

69

120 154

172

154

2010 2011 2012 2013 JulySUV Mid-size PC Small PC

704740

856

586

Market Strategy

New Model Launch Mistra CF (2H 2013) : Expand model line-up with customized

model to Improve customer profile and brand perception

Dealer Enhancement Plan

600

720

800860

2010 2011 2012 2013(P)Number of Dealers

Focus on improving customer services and brand image

Sonata HEV (2H 2013) : Launch Eco friendly model to enhance brand image

(‘13 P) *

26

Europe

Source: Company data, ACEA


15,393 15,316 14,015 13,481

2.6%2.9%

3.5%3.0%

2010 2011 2012 2013 July

Industry M/S

274 258294

161

80 139

145

81

8

6

5

2

2010 2011 2012 2013 JulyOthers RV PC

362

403444

244

Market Strategy

New Model Launch

i10 (2H 2013) : Improve sales volumn by launching A seg model under economic downturn period

Expand Direct Distribution Coverage

Indirect57%

Direct43%

Indirect31% Direct

69%

2011 2012

Direct distribution coverage– As of 2011: UK / Spain / Italy / Norway / Poland

/ Czech (including Slovakia)– Newly established in 2012: Germany / France

Santa Fe Long body (2H 2013) : Enhancing SUV Line-up to improve sales and brand

Strategy to overcome the economic crisis Focus on qualitative growth over quantitative growth 5 major plan for qualitative growth

→ Brand enhancement / improve product competitiveness / penetrate true fleet market / improve dealer network / strengthen services

(‘13 P)

27

India

Source: Source: SIAM, Company data* Market demand based on Passenger Vehicle ** Sales data based on factory sales


2,309 2,430 2,656 2,590

15.4% 15.4% 14.7% 15.3%

2010 2011 2012 2013 July

Industry M/S

357 373 391

224

247 242250

157

2010 2011 2012 2013 JulyExport Domestic**

604 615641

381

Market Strategy

New Model Launch Santa fe (2H 2013)

i10 (2H 2013)– Entrance to the Indian compact-mid market– Compete with Ford FIGO

Specification Comparison

Grand i10 FIGO

Displacement 1,200cc 1,200cc

Max. Power 83ps / 11.6 tq. 71ps / 10.4 tq.

Mileage 18.9km/ℓ 15.6km/ℓ

MSRP 429K Rs ~ 612K Rs 427K Rs ~ 632K Rs

(‘13 P)*

28

Other Emerging MarketsAchieving consistent sales volume growth through the years.

Africa-middle East and LatAmSales Breakdown by Major Emerging Markets Sales Volume (000’s) and CAGR (%)

Source: Company Data, 2012 HMC Global Retail Sales (excludes CKD sales)

Korea15.2%

N. Am.19.1%

Europe15.2%

Chindia28.3%

LatAm6.1%

Asia-Pacific 3.8%

Africa-Middle East

11.2%

Turkey 1.1%

Africa-ME

LatAm

82115 128

165 177 185

237258 268

2004 2005 2006 2007 2008 2009 2010 2011 2012

118185 208

253292 316

419448

493

2004 2005 2006 2007 2008 2009 2010 2011 2012

+16%

+20%

Appendix

30

Balance Sheet (K-IFRS Consolidated)

(KRW in Billions) 2012 2013 1H Change

Assets 121,538 129,701 8,163

Current Assets 54,848 57,838 2,990

Cash and Cash Equivalents1 19,143 22,180 3,037

Liabilities 73,620 77,402 3,782

Current Liabilities 32,836 34,289 1,453

Short and Long-term Debt 45,207 47,144 1,937

Provision 7,009 7,460 451

Equity 47,918 52,299 4,381

Current Ratio(%) 167.0% 168.7%

Debt/Equity (%) 94.3% 90.1%

Net Debt 26,064 24,964

Source: Company filings (K-IFRS Consolidated)1. Cash and Cash Equivalents = Cash + Short-term Financial Instruments

31

Income Statement (K-IFRS Consolidated)

(KRW in Billions) 2012 1H 2013 1H Growth

Revenue 42,105 44,551 5.8%

Gross Profit 10,049 10,023 △0.3%

Margin (%) 23.9% 22.5%

SG&A 5,419 5,748 6.1%

Portion (%) 12.9% 12.9%

Operating Profit 4,631 4,275 △7.7%

Margin (%) 11.0% 9.6%

Recurring Profit 6,296 5,939 △5.7%

Margin (%) 15.0% 13.3%

Net Income 5,001 4,611 △7.8%

Margin (%) 11.9% 10.3%

Depreciation 824 878

Amortization 418 411

EBITDA1 5,873 5,564

Source: Company filings (K-IFRS Consolidated)1. EBITDA = Operating Profit + Depreciation + Amortization

32

Financial Summary by Division

Source: Company filings (K-IFRS Consolidated)

(KRW in Billions) 2012 1H 2013 1H Growth

Sales Revenue 42,105 44,551 5.8%

Automotive 36,323 36,720 1.1%

Finance 4,041 5,116 26.6%

Other 1,741 2,715 55.9%

Operating Profit 4,631 4,275 △7.7%

Automotive 4,065 3,427 △15.7%

Finance 640 674 5.4%

Other 76 188 147.4%

Consolidation Adjustment △150 △14 △90.7%

Documents

Hyundai Motor · PDF fileSales Growth and Diversified ... Portion of Exports from Korea Plant OP Margin & KRW/USD Exchange Rate Trend Source: Company data * Hyundai