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Hyundai Heavy chief’s entry to boardroom buoys expectation on shipbuilder’s major transition

By Hong Yoo

Published : March 22, 2022 - 17:52

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Korea Shipbuilding & Offshore Engineering’s newly appointed CEO Chung Ki-sun (Hyundai Heavy Industries) Korea Shipbuilding & Offshore Engineering’s newly appointed CEO Chung Ki-sun (Hyundai Heavy Industries)
Chung Ki-sun, the grandson of Hyundai Group founder Chung Ju-young, on Tuesday was named CEO of Hyundai Heavy Industries Group and its subholding company Korea Shipbuilding & Offshore Engineering, opening a new chapter for the world’s largest shipbuilder.

Shareholders of the two companies approved the appointment on the eve of the group’s 50th anniversary, when it aims to reestablish its brand identity as a technology-centered group, departing from its decades-old image as a traditional manufacturing company.

Under the renewed vision, the group plans to invest in three core future technologies across all affiliates: autonomous navigation, liquid hydrogen transport and propulsion and intelligent robotics.

Chung is the son of Chung Mong-joon, a former politician and the sixth son of the late Hyundai founder. Because the elder Chung had pursued a political career throughout his life, the shipbuilder previously had CEOs with no direct ties to the founder’s family thus far.

The junior Chung, 40, took office as president of Korea Shipbuilding & Offshore Engineering in October last year but had remained as an unregistered executive. With his entry to the boardroom, he may face more responsibility and public scrutiny, but will play a leading role at the forefront in the group’s major transition.

“Starting from the sea, HHI Group’s technological innovation will change the lives of people in the future,” Chung said during the group’s debut press conference at CES 2022 in January.

Along with Chung, current CEO Ka Sam-hyun was renamed as co-CEO, with his term as a registered executive being extended as well.

“We will make technology and talent the core value of company management and advance eco-friendly and digital ship technology, while leading a new future at the Global R&D Center, which will be completed in the second half of this year, through synergy with the group’s shipbuilding affiliates,” Ka said in his opening remarks of the shareholders meeting.

The group’s investment plans in new businesses were reflected in its accomplishments, including a successful test run of a fully autonomous cruise ship last year.

In January, the shipbuilder said it will operate the world’s first autonomous ship in the first quarter of this year.

The group has also jumped into establishing a marine hydrogen value chain by aiming to build a 100-megawatt hydrogen production plant and to develop the world’s first 20,000-cubic-meter hydrogen carrier by 2025.

It aims for construction sites to be unstaffed and instead operated with smart robots by 2025.

The firm posted 15.4 trillion won in sales ($12.7 billion) and 1.38 trillion won in operating profits last year.

Hyundai Heavy Industries also announced Tuesday that it has successfully sold five-year green bonds worth $300 million to overseas investors for the first time.

The shipbuilder will be using the proceeds from the green bond sale to invest in developing environmentally friendly ships and to enhance sustainable growth based on environmental, social and governance management.

Hyundai Heavy Industries Group will also change its name to HD Hyundai at the Hyundai Heavy Industries Holdings’ shareholders meeting to be held Monday.

“The name change is aimed at shifting away from the image of a traditional manufacturer to an investment company exploring new growth engines,” Hyundai Heavy explained.