Hyundai Motor America CEO and President John Krafcik gave the keynote speech at the Midwest Automotive Media Association’s kickoff breakfast yesterday morning at the Chicago Auto Show. He called his talk “Preparing for a Revolution,” and made a few admissions worth noting.
Krafcik declared the “greed is good” era no longer welcome. The excesses that defined the time between the ‘80s and 2008ish, “may finally be at a close. The current global economic crisis has paved the way for significant change,” he said. Then there was this:
“Preparing for a Revolution”
Thank you. This truly is one of my favorite auto shows. I’d like to thank Jim and Jerry for putting together another great event this year, and I am honored to be here. Apart from the usually freezing temperatures here in Chicago in February, there’s really no place I would rather be.
I know the rich history of the MAMA breakfast, and I’ve sat in the audience with you on many occasions listening to the inspirational and esteemed executives who have spoken here in the past. It certainly is an enormous honor to follow in their footsteps kicking off this show, and I can only hope I don’t tarnish the legacy you’ve built.
Greed Is No Longer Good
Like many of you, I began my career in this industry in the 1980s. It was an era frequently characterized as the “decade of greed.” This notion has been reinforced through popular culture – from Michael Lewis’ book “Liar’s Poker” – to fictionalized bond trader and self-described “Master of the Universe” Sherman McCoy in Thomas Wolfe’s “Bonfire of the Vanities” – to Gordon Gecko’s infamous “Greed is good” speech in the iconic movie Wall Street.
The truth is, the decade of greed didn’t end in the 80s. The junk bond and S&L scandals of the 80s were followed by the Internet bubble of the 90s, which gave way to the mortgage-backed-securities-generated crisis we face today.
It turns out the decade of greed has lasted 28 years…and has left Wall Street consumed in its own Bonfire of Vanities.
One thing seems fairly certain – as 2009 unfolds, the era of greed may finally be at a close. The current global economic crisis has paved the way for significant change.
This change has already taken on a revolutionary nature. It involves a new government in the U.S. with new policies and new agendas. It challenges the ever-widening gap between the haves and have-nots by calling for a more equitable distribution of income. It brands skyrocketing executive compensation as “shameful.” It brings with it a sea-change in consumer behavior, with conspicuous consumption becoming more susceptible to criticism, and increasingly unaffordable.
Embracing Fuel Efficiency
Another revolutionary step we can take is to embrace improved fuel economy as an indisputable social good. There’s really no point in arguing about the veracity of climate change when you stop to consider the finite supply of oil, and the turmoil that our present consumption habit is fueling in the Middle East. It’s abundantly clear that improved fuel economy makes sense for our industry and for our country.
In this regard, we’ve taken significant steps at Hyundai to move forward as an environmental leader. At last year’s Auto Show in Los Angeles, we unveiled our Hyundai Blue Drive strategy, which aims to make us the most fuel efficient car company in the U.S. We’ve pledged to achieve a fleet average of 35 miles per gallon by 2015 – a full five years ahead of NHTSA’s original deadline. A bold position perhaps, but we were honestly surprised to be alone amongst all automakers in taking a position like this one. Going forward, we’d love to have some company here.
As an industry, we need to take a longer term view of our environmental strategies. That means stepping up and getting ahead of the regulators where that makes sense. We think that time is now.
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