Hyundai, Kia appoint new global r&d chief to 'solidify' quality

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SEOUL (Reuters) -- Hyundai Motor Co. and affiliate Kia Motors Corp. have named a new president of their joint research and development division, a month after the previous chief resigned over quality issues.

Kim Hae-jin, 56, was head of the development of engines and transmission and previously managed r&d quality control.

He is tasked with helping restore the carmakers' reputations after predecessor Kwon Moon-shik resigned to take responsibility for a series of quality issues after just a year in charge.

Hyundai and Kia, which share parts and platforms, recalled nearly 1.7 million vehicles in the United States in April because of potential faults in brake switches. They recalled another 600,000 vehicles in South Korea in September because of the same issues.

The r&d appointment "is aimed at solidifying our quality management," Hyundai Motor Group said in a statement on Friday.

Market watchers say Kim will need to speed up efforts to expand the companies' range of fuel-efficient diesel and hybrid engines to fend off imports in South Korea.

Overseas, Hyundai is preparing to start selling its hydrogen-fueled Tucson crossover next year in the United States, where rival Nissan Motor Co. has been pushing battery-powered electric cars.

"Hyundai has been a market follower, and has brought their technology to the levels of overseas rivals. But this is not enough," said Cho Chul, a researcher at the Korea Institute for Industrial Economics & Trade.

"Hyundai needs to become a trend-setter, and to do that, R&D plays a crucial role... Hyundai needs to further increase its R&D budget."

Hyundai spent 1.63 trillion won ($1.54 billion) on r&d last year, or 1.9 percent of revenue, according to its annual report. In contrast, BMW AG spent 3.99 billion euros ($5.47 billion), or 5.2 percent.

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