Overview of the current state of the art and trends

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Introduction
Hyundai Motor Company, founded in Korea in 1967 with the launch of the Pony, has undergone a dramatic transformation over the past decades. Although Hyundai was founded to produce inexpensive cars, it entered the U.S. market almost two decades later with the Hyundai Excel (Teece, 2022). A significant turnaround occurred after the company hired an experienced Nissan executive, Jose Munoz, to take on the role of CEO. Teece (2022) further highlights that under Munoz’s leadership, Hyundai shifted from what was seen as a ‘good value’ brand to recognising the company as a producer of well-designed and technologically innovative automobiles. It was adding value to its image, and at the same time, Hyundai established robust profitability and moved up squarely into the automotive top three behind Toyota and Volkswagen while establishing the fastest-growing volume brand behind only Tesla.
This paper assesses Hyundai’s internationalisation in the United States based on a firm-specific, industry-specific, and country-specific analysis. Reflecting on the theories of the Resource-Based View, Industry-Based View, and Institution-Based View, alongside strategic diagnostic tools, the study will identify Hyundai’s internal competencies, competitive stance, and the ways in which it is managing the transition into the U.S. market (Cawman & Liu, 2020). Therefore, by combining the findings of Teece’s (2022) case study with theoretical frameworks, this essay can offer a balanced evaluation of Hyundai’s strategic transformation process and the achievement of its sustainable competitive advantage in the competitive riding sector of the automobile industry in the United States.
Firm-Specific Factors
Dynamic Capabilities & Leadership
Hyundai’s strategic shift in the U.S. market is mainly due to the organisational dynamic capabilities that are espoused at the managerial level. While under the leadership of its ex-Nissan executive Jose Munoz, the car giant managed to reveal a strong aptitude for “sensing, seizing, and reshaping (Teece, 2022).” Munoz’s appointment was a turning point because he brought an analytical mindset to Hyundai that resulted in more efficient organisational functions, such as better coordination for semi-autonomous business units and a more vigorous and productive dealer network (Teece, 2022). In this way, by quickly identifying these problems and fixing them, Munoz not only reinforced greater internal integration but also changed the strategic direction of the company towards a higher quality, technology-focused brand. However, Sunwoo et al. (2024) underscore the centrality of visionary leadership in business transformation with support from effective followership, providing further support to the argument that Hyundai’s top management was instrumental in this transformation.
Resource-Based View (RBV) & VRIO Analysis
Balancing these on the RBV and VRIO analysis of the key resources, Hyundai has found a strong internal resource base that is revealed to be valuable, rare, inimitable, and bundled. Massive investments in research, technology, and design have yielded a set of assets that are crucial to delivering and sustaining improvements in quality, many of which are also challenging for rivals to imitate (Warren, 2023). For example, the efficient technological system that enhances operations and customer relations by applying artificial intelligence can be seen as the cornerstone of Hyundai’s competitive edge (Hyundai, 2024). Furthermore, the global reach coupled with superlative supply chain management systems means the firm can easily coordinate its production and distribution networks (Teece, 2025). These capabilities reflect on the VRIO analysis since they create value by guaranteeing that Hyundai’s resources create sustainable competitive capability (Jurevicius, 2023).
Internal Restructuring & Value Chain Management
In an effort to correct internal missteps in the organisation, Hyundai embarked on extensive restructuring to fix the ailing structure. Earlier on, the company was facing problems in ensuring proper coordination with its numerous business departments, resulting in duplicated work and an incongruent customer environment (Teece, 2022). With efforts to move up the value chain – including the growth of manufacturing operations in the U.S. – Hyundai has been able to cut production costs, minimise the impact of tariffs, and adequately meet the needs of domestic consumers (Hyundai, 2024). The repositioning of activities in this manner not only increases efficiency but also adaptability in the fast-changing market environment. As mentioned by Suh et al. (2014), such internal reorganisation is essential for fast growers and internationalising firms, especially East Asian multinationals, in order to develop a strong and dominant role of subsidiaries in foreign countries. The concept of GVCs also shows how Hyundai effectively uses its production network to implement economies of scale and increase competitiveness (Zhuquing, 2019).
Marketing and Brand Repositioning
Hyundai’s change over the years from a manufacturer that produced cars seen as cheap and economical cars, best illustrated by the Hyundai Excel, to a car manufacturer depicting innovation and sophistication in both design and technology is an example of good marketing and brand management strategy (Teece, 2022). By adopting a geocentric market orientation in international marketing, the company has also found a middle ground between two extremes that appeal to a wide range of consumers in America (Munjal, 2025). Programs like the “For Tomorrow” campaign and “Mobile by Design” have been crucial in changing consumer attitudes. In Ramsay-Lemelin’s (2024) work, there is an extensive presentation on how Hyundai successfully transitioned from a mass car maker to a ‘design and technology’ car manufacturer without changing its logo. Moreover, added features like long-term warranties and promotional financing not only paved the way in restoring consumer confidence but also set Hyundai apart from rivals that relied mainly on the price advantage mechanism (Moura et al., 2017). Such efforts in repositioning the brand have helped to increase customer loyalty and raise brand recognition, which has a cumulative effect on enhancing Hyundai’s competitive base in the United States automotive industry.
With the application of firm-specific strategic implementation, including transformational leadership, internal resource management, operational changes, and marketing strategies, Hyundai has effectively overcome the firm-specific challenges to achieve competitive maturity in the U.S. automobile market environment (Shim & Steers, 2012). Every single component of this integrated approach, from understanding Munoz’s dynamic capabilities to strict adherence to the VRIO framework and enhancing the value chain, has played its role in the company’s new ambitious turnaround plan and shows how a planned internal strategy can open wings for international success (Jurevicius, 2023).
Industry-Specific Factors
Competitive Environment – Porter’s Five Forces
The automotive industry of the United States of America is characterised by its high competitiveness in terms of brands such as Toyota, Volkswagen, Tesla, and Ford. The threat of entry into the industry is low since the initial investment costs are high, entry is regulated, and supply chains are indispensable (Swiecki & Dziczek, 2025). For instance, Hyundai continues to enjoy economies of scale, a production line, and a distribution network that new entrants into the automobile market cannot easily emulate. Moreover, the threat of substitutes is also moderate: while there are other ways to commute through mass transportation, car-sharing, or short-term car leasing, the desirability of having one’s car remains a crucial factor for consumers (MBA Skool Team, 2023b).
The bargaining power for buyers in the current U.S. market is relatively high. Growing competition and consumer awareness allow them to gather a lot of information about the various products, thus putting pressure on manufacturers to engage in constant product differentiation and price manipulation (MBA Skool Team, 2023b). However, supplier power is not considerably high despite multiple challenges, such as a shortage of semiconductors. According to the MBA Skool Team (2023b), the suppliers tend to be small and usually operate in price-sensitive environments. High aggressiveness is the most significant force of competition; for instance, in the Focus2Move (2025) report of January 2025, Toyota was ranked as the leading manufacturer with 830048 units sold, followed by Volkswagen with 668199 units, and Hyundai-Kia 498543 units. However, they experienced a 7.1% drop. These figures highlight the cut-throat levels of competition that Hyundai needs to manage.
Industry-Based View & Blue Ocean Strategy
Hyundai has exhibited strategic evolution through the deployment of innovative sources that establish new niches in the firm’s strategic evolution. Accordingly, by venturing into EVs, hydrogen fuel cells, and self-driving features, Hyundai has applied the Blue Ocean Strategy, resulting in uncontested market spaces (Chavan & Jindal, 2024). The success of models like the Ioniq 5 and NEXO shows that the business is devoted to green and innovative mobility plans. Breno Niero et al. (2023) also concluded that such technological tools not only helped Hyundai stand out from existing competitors but also expanded the brand’s appeal to innovative and environmentally conscious consumers.
Global Value Chains (GVCs) and Sourcing Strategies
Hyundai’s global value chains are critical to its competitive strategy as they help to reduce costs and minimise risks (Zhuquing, 2019). Hyundai has been stretching its international sourcing and production networks, thereby positioning itself to respond to threats such as the restricted availability of semiconductors. For instance, investing in U.S. facilities enabled Hyundai to cut production cycle times, avoid tariffs’ impact, and adapt products to local preferences (Ozan, 2025). The vertical integration of the supply chain, from getting the raw material all the way to assembling, enhances the company’s quality and flexibility. In the same year as per Hyundai (2024), independently from the company Hyundai and including the independent dealers, created more than 190000 direct jobs and contributed $20.1 billion of personal earnings to the U.S. economy, which is evidence of the size and effectiveness of supply chain networks.
Market Positioning and Technological Trends
Hyundai has made a succession of reconceptualisations of its positioning strategy, which has been attributed to a shift towards innovation and quality. Hyundai has shifted from a low-end brand associated with products like the Hyundai Excel to a brand associated with premium design and superb technology (Teece, 2022). This repositioning is reflected in a diverse portfolio of cars; for example, Sonata and Genesis models have become equipped with self-driving systems and connectivity that improve the ownership experience. According to Brauer (2023), Hyundai’s sales in Q1 2023 in the United States increased to a record level of 184,449 vehicles, while in March alone, the increase was 27% compared to the previous year, which proves the efficiency of innovation-focused strategies. The figure below illustrates Hyundai’s increasing sales in the U.S. market, demonstrating the impact of its innovation-focused repositioning strategy.
Figure 1:Hyundai, Kia, and Genesis sales trends in the U.S. from Q1 2018 to Q1 2023.

Source (Brauer, 2023).
Hyundai’s ambitious electric vehicle push strengthens the automaker’s focus and strategy. Hyundai has put into production its Integrated Modular Architecture (IMA), which has led to the standardisation of EV production, hence cutting on costs and development challenges (Breno Niero et al., 2023). This advancement also benefits from cost advantages associated with mass production, increased power-to-weight ratios, and shorter charging intervals. According to Focus2Move (2025), there has been an overall decrease in this segment; however, Hyundai-Kia sold 498,543 vehicles of different types of cars and boasted remarkable results in the field due to advancements in hybrid & fully electric vehicles.
Besides, recent improvements in quality enhancement investments, such as long-term warranties and customer service support for its cars, have added to Hyundai’s brand image (Moura et al., 2017). It has created higher customer loyalty and helped Hyundai to stand out from its competitors, as quality and innovation are key values in this industry. These three aspects of strategic management of innovation, global sourcing, and market positioning make it possible for Hyundai not only to compete but also to establish new benchmarks in the ever-evolving automobile market.
In conclusion, Hyundai achieves effectiveness in handling industry-specific challenges through competitiveness, strategic growth paths, responsiveness to global value webs, and dynamic market positioning. Through these elements, Hyundai is not only able to maintain its competitiveness but also continue to grow in the U.S. automotive industry (MBA Skool Team, 2023b; Focus2Move, 2025).
Country-Specific Factors
PESTEL Analysis of the U.S. Market
The external environment of the U.S. market is a complex and challenging factor that directly impacts Hyundai’s efforts to internationalise its business operations. From a political and legal perspective, the United States has stable legal systems in place that include facilitating trade policies and providing incentives to foreign investors through incentives such as the EV tax credits (MBA Skool Team, 2023a). However, changes in government policies and trade relations might lead to fluctuations in various barriers, such as tariffs and regulations, which may compel Hyundai to evolve regularly.
Economically, the United States stands as one of the biggest automotive markets in the world in terms of consumer purchasing capacity and a substantial middle-income population. Hyundai Motor America (HMA) and its dealers collectively infused about USD 20.1 billion in annual income to the country in 2021. They created nearly 58,250 jobs, highlighting the tremendous economic scope (Chen et al., 2023). From the social and cultural perspectives, U.S. consumers are gradually demanding vehicles that are not only reliable but also safer, environmentally friendly, and technology-innovated. In this regard, Hyundai has offered cars that reflect such trends in relation to lifestyle and performance by modifying its products to fit the emerging market demand (MBA Skool Team, 2023a).
In terms of technology, the automotive industry in the United States today is one of the most advanced. Currently, there is massive pressure towards emissions-free vehicles, as well as the automation of cars, due to strict environmental legislation (Beltrami et al., 2021). Previous cases like a USD 47 million fine for dodging diesel engine emission norms give utmost importance to compliance with environmental standards, which in return compelled Hyundai to develop innovative EV and fuel cell solutions (MBA Skool Team, 2023a).
Institution-Based View & Integration-Responsiveness (IR) Framework
The institution-based view posits that formal institutions like legal systems, regulatory bodies, and government policies significantly influence business strategies (Cawman & Liu, 2020). Hyundai uses these institutions in the U.S. to set out guidelines for healthy market entry and operation. The Integration-Responsiveness (IR) framework also exemplifies how Hyundai sustains a balance of integration with the global network and local response to the environment (Blind et al., 2024). Though it achieves economies of scale in production and research and development departments, the organisation differentiates its products for the American market. For instance, increasing manufacturing plants in the United States help in adapting the vehicles’ characteristics to suit the customers’ preferences and conditions, as well as meeting regulatory behaviors and requirements, which contributes to cost efficiency and essentially immediate responsiveness (Breno Niero, 2023).
FDI and the OLI Framework
The OLI (ownership, location, internalisation) framework is used to analyse Hyundai’s robust overseas foreign direct investment (FDI) strategy in the U.S. (Luo, 2021). The Ownership advantages are clear; strong technological capabilities and well-established brand equity constitute clear Ownership advantages, putting Hyundai with a sustainable competitive edge over the competition. States like Alabama with Hyundai Motor Manufacturing Alabama (HMMA) all exhibit location-specific advantages (Vogiatzis, 2017). So, Alabama offered incentives estimated at roughly USD 240 million, excellent infrastructure, and favourable labour conditions with a unionisation rate of around 9.8 per cent, much lower than in the Midwest (Vogiatzis, 2017). Through vertical integration in the supply chain, from raw material supply to final product assembly, Hyundai achieves internalisation advantages of consistency in quality and operation.
Recent data shows that Hyundai has made a lasting impact. Hyundai’s U.S. operations in 2021 directly employed around 7,000 workers and indirectly supported another 21,000 jobs, according to Chen et al. (2023). In addition, Hyundai has demonstrated its ongoing commitment to electrification through its planned investment of more than USD 10.6 billion in new EV and battery manufacturing facilities in Georgia and Alabama, which is expected to generate up to 62,800 new jobs by 2025 (Chen et al., 2023).
Impact of U.S. Market Conditions
The market conditions in the United States have a crucial role to play in Hyundai’s internationalisation plan. The overall automobile market in the United States of America is very competitive, and customer needs and demands have shifted towards more technological delegation, safety concerns, and environmental impact (Cole & Yakushiji, 2020). Hyundai has gradually made new and improved mixed products available to meet these demands. Modern vehicles, including the Hyundai Ioniq 5 and Hyundai Ioniq 6, feature sophisticated self-driving systems and environmentally friendly power sources that fully satisfy consumers in the United States (Kane, 2024). The figure below illustrates Hyundai’s Ioniq 5 and Ioniq 6 sales trends in the U.S., highlighting the growing demand for electric vehicle
Figure 2:Hyundai Ioniq 5/6 U.S. sales trend

Source (Kane, 2024).
Also, Hyundai has maintained good after-sale service and comprehensive warranty support, which enables the company to capture customer loyalty and trust in the U.S. market (Usher & Burgett, 2019). Ultimately, their strategic emphasis on the quality and innovation of their products has been significantly reflected in their sales figures. For instance, while competition is stiff, Hyundai-Kia registered as many as 498,543 vehicles in January 2025, which proves the company’s flexibility in a high-growth environment (Focus2Move, 2025; Brauer, 2023).
In conclusion, Hyundai’s strategy in the U.S. has been dramatically shaped by the various factors that have been discussed using PESTEL, the institution-based view, and the OLI framework. Social, political, and legal contexts, economic freedom, and an advancing technological environment are also quite favourable. On the other hand, Hyundai’s FDI decisions and commitment to the local context allow the company to adapt and remain competitive. These advantages not only helped Hyundai maintain its competitive position but also fostered organic growth in the stiffening automobile market of the United States of America (MBA Skool Team, 2023a; Vogiatzis, 2017; Chen et al., 2023).
Conclusion
Overall, Hyundai’s transition in the context of the U.S. market involves a combination of internal competencies, relevant strategies within the industry, and modifications to the local environment. The application of dynamic capabilities is most appropriate at Hyundai, where Munoz built on the company’s sensing, seizing, and transforming capabilities to overhaul the company’s internal issues while changing the perception of the Hyundai brand as a low-end car manufacturer to one that is associated with design and technology. Based on the Resource-Based View and VRIO analysis, the multi-year investments in R&D, technological advancement, and innovation have been manifested as valuable and scarce resources, thus ensuring a competitive advantage for the company.
In parallel, Hyundai has responded adeptly to external industry pressures. It has realised cost efficiencies through Ocean Strategy and dealt with supply chain issues, including semiconductor shortages, capitalising on global value chains. The firm’s continuing evolution in market positioning, through the refinement of its product offering through Ioniq 5 and Ioniq 6, demonstrates the firm’s commitment to keeping pace with U. S. consumer demand for safety, sustainability, and technological advancement.
So, looking ahead, Hyundai should spend more on EV technology and build to secure its edge. It is also essential that the technology adapts to the market continuously as more and more regulatory and technological trends arise. Nevertheless, limitations exist concerning the market’s volatility in the global environment and new consumer needs. Future advancements in autonomous driving and sustainable mobility should be researched for future automobiles since Hyundai will maintain its position in a rapidly transforming automotive landscape.

References
Beltrami, D., Iora, P., Tribioli, L., & Uberti, S. (2021). Electrification of compact off-highway vehicles—overview of the current state of the art and trends. Energies, 14(17), 5565.
Blind, K., Jastram, S. M., & Müller, J. A. (2024). Subsidiary strategy and importance of standards: An institutional development of the integration-responsiveness framework. European Management Journal.
Brauer, K. (2023, April 10). How Hyundai Succeeds In A Struggling, Competitive Auto Market. Forbes. https://www.forbes.com/sites/kbrauer/2023/04/10/how-hyundai-succeeds-in-a-struggling-competitive-market/
Breno Niero, Srimeechai, P., Chhabra, R., & Samarth Kanoi. (2023, December 5). Charging Innovation: A global business analysis of Hyundai’s electric future. ResearchGate; unknown. https://www.researchgate.net/publication/376203954_Charging_Innovation_A_global_business_analysis_of_Hyundai

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