John Krafcik
John Krafcik
Photos courtesy of Hyundai

Hyundai Motor America's Change at the Top Comes on Heels of Inflated Fuel Economy Deal

Hyundai Motor America, which has offices in Irvine, Costa Mesa and--now lighting up a stretch of the 405 freeway at night--Fountain Valley, recently announced that President and CEO John Krafcik was stepping down, replaced by Executive Vice President of Sales David Zuchowski, effective today.

The surprise change at the top comes at a curious time for the South Korean automobile maker.

Hyundai and Kia Motors America, whose international brand is 32.8 percent owned by Hyundai Motors Group of Seoul, had just before Krafcik's announcement issued another one revealing they had settled class-action litigation over inflated fuel economy claims.

After an investigation in 2012, the EPA found that 35 percent of all 2011-2013 Hyundai and Kia vehicles had inflated fuel economy numbers, some by as much as six miles per gallon. The fuel-economy announcement disclosed that owners of Hyundai models with inflated ratings are to receive an average of $353, while Kia plans to give owners of its affected vehicles an average of $667.

Though Kia's per-customer average is higher, the settlement agreement was estimated to cost the company about $185 million compared to around $210 million for Hyundai, a reflection of how much more popular the latter brand is with Americans. The exact total of the payouts will depend on whether customers of both companies take lump-sum payments or dealership credits of 150 percent of the lump sum that can be used for service or 200 percent toward a new car.

The latter Hyundai announcement regarding the futures of Krafcik and Zuchowski made no mention of the fuel-economy controversy.

"John's forward-looking perspective, commitment to quality and design, and pursuit of innovative new product offerings have elevated the Hyundai brand and introduced our vehicles to a new generation of satisfied and loyal customers," Im Tak Uk, executive vice president and chief operating officer of Hyundai Motor Co., says of Krafcik in the release.

"It's been a sincere privilege and honor to lead Hyundai Motor America over the past five years, and I am confident that with Dave's succession, our brand will continue to expand and thrive for years to come," Krafcik says in the announcement.

Zuchowski, who joined Hyundai Motor America in February 2007, is quoted as saying, "I am both humbled and excited to lead Hyundai Motor America into the next chapter by continuing to build on John's great legacy, and focusing on what matters most--building the highest quality, safest and most diverse fleet of models that customers love."

Im says of Zuchowski, "He exhibits a rare combination of passion, intelligence, creativity and diligence, and we are confident that he is the right choice to build on John's momentum and take Hyundai to new and greater heights."

Just avoid building greater-than-real-fuel-economy claims, babe.

Email: Twitter: @MatthewTCoker. Follow OC Weekly on Twitter @ocweekly or on Facebook!


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