Hyundai Card chief – creative strategist

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Chung faces daunting task amid industry downturn

Hyundai Card CEO Chung Tae-young is widely known in the local credit card industry. He emerged into the spotlight in the early 2000s not only as the son-in-law of Hyundai Motor Chairman Chung Mong-koo, but also the chief executive of Hyundai Card. Chung Tae-young, also known as Ted, has been recognized for a lot of accomplishments in the industry. He is also the vice chairman of Hyundai Card and Hyundai Capital. He started cultural marketing campaigns promoting Hyundai Card by joining hands with museums, movie theatres and libraries. His deals such as Hyundai Card’s joint venture with GE Capital are analyzed and depicted in local business case studies as one of the prime examples of leading strategic partnerships. The joint venture was formed in 2005. GE Capital sold its shares in Hyundai Card in 2017 as General Electric was winding down its financial business. Private equity funds and Hyundai Commercial bought GE Capital’s Hyundai Card stakes then.

 
Chung has won numerous awards for his innovative leadership, and is constantly ranked among 100 prominent CEOs here by business news publications. A graduate of MIT with a master’s in business administration, he is sometimes referred to as “one of the crazy ones” with a knack for trying out new things. Apple founder Steve Jobs described himself as well as others with an innovative mindset as “the crazy ones, misfits and rebels.” “He has set the bar in culture marketing and credit card design. It was creative. Now, every company is doing something like that integrating art and technology into cards,” said an industry source. Hyundai Card has also forged ties with Costco Korea, beating out Samsung Card through a bid. Samsung had been Costco’s partner for the last 18 years. Costco consumers will have to either use Hyundai Card or cash to buy products beginning May 2019 for the next 10 years.

 

However, like any other innovators in history, Chung faces one of his greatest challenges amid an industry downturn.The card company’s operating profit stood at 163.3 billion won ($145 million) in the first nine months of 2018, down 32.5 percent from the same period a year ago. Its per capita productivity only amounts to 66 percent of the industry’s average of 116 million won. No. 1 Shinhan Card’s per capita productivity stood at 154 million won, according to a local data analyst based on the industry’s third-quarter financial statements and data from the Financial Supervisory Service. The card firm is streamlining its organization through massive restructuring. “All companies are practically facing a similar situation amid a state-enforced rate reduction,” said the source. It remains to be seen how Chung will weather the storm ahead. Hyundai Motor, Kia Motors and Hyundai Commercial combined have about a 73 percent stake in Hyundai Card. Chung’s wife, the Hyundai Motor chairman’s daughter, is also an executive of Hyundai Card, Hyundai Capital and Hyundai Commercial. She has a 33 percent stake in Hyundai Commercial.

 

By Park Hyong-ki

(Korea Times)

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