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Defending a global brand

Hyundai flap has lessons for other MNCs

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Kashmir | Hyundai | Business Standard Editorial Comment

Business Standard Editorial Comment  |  Mumbai 

It is not often that a post by a provincial car distributor leads to a conversation between two foreign ministers —but that is just what has happened following a message on from a Pakistani vendor of cars that expressed support for Kashmiri separatists. Following a firestorm on Indian social media, the South Korean foreign minister spoke to his Indian counterpart to express his regrets. Whether posts of this sort should eventually be raised to the level of external affairs ministries is one question. But the other question is how transnational companies, like Hyundai, can effectively manage their operations at a time of increasing geopolitical tension. India issued a statement dissociating itself from the post by the distributor in Pakistan. This did not noticeably calm tensions, nor was it likely to. It is true that Hyundai’s sales in India are unlikely to suffer any lasting damage. But the fact remains that a build-up of such incidents is not good for a brand’s image and shifts companies into fire-fighting mode. Multinationals which face significant domestic competition —like a South Korean carmaker in India — will find themselves particularly disadvantaged in that they will fear some offended potential customers will switch to locally-made alternatives.

ALSO READ: Kashmir post: From KFC to Toyota, global firms scramble for damage control

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First Published: Wed, February 09 2022. 22:50 IST
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