Cho Hyun-bum, chairman of Hankook & Company, known as a racing enthusiast, is expressing a willingness to expand his motorsport business. While he has made supplying tires to the Formula 1 (F1), the world's largest auto racing event, a major management goal, it is known that he has significant concerns about the business risks.
Chairman Cho made a surprise appearance at the launch event of the new Lamborghini supercar brand on 6th. He attended the launch event for Lamborghini's plug-in hybrid (PHEV) new model 'Revuelto' at the invitation of Stephan Winkelmann, chairman of Lamborghini, and met with Winkelmann. The two companies discussed various cooperation plans, including tire supply.
Chairman Cho has shown interest in high-performance supercars, including Lamborghini, and is dedicated to the motorsport field. Since being appointed as CEO, Hankook Tire has not only invested in research and development (R&D) for racing tires but also expanded sponsorships in global motorsport events and domestic racing teams such as Korea Competition (previously known as ArtraS BX).
Chairman Cho often attends racing events held both overseas, including Germany and Italy, and domestically. He visited Yongin Speedway in Gyeonggi Province last year to watch the 'Hyundai N x Toyota Gazoo Racing Festival' alongside Lee Jae-young, chairman of Samsung Electronics, and Chung Eui-sun, chairman of Hyundai Motor Group, and sometimes goes to the races alone.
The championship that Chairman Cho enjoys is F1, which is grouped with the Olympics and the World Cup as the three major sports competitions. Since 2010, he has visited the F1 Korea Grand Prix four times along with his children, and he is known as a long-time fan of the Mercedes AMG Petronas F1 Team.
He is also ambitious about supplying tires to F1 from a business perspective. Earlier this year, he was selected as the supplier for the World Rally Championship (WRC), the three major motorsport events (WRC, F1, NASCAR), and while he has achieved results in the motorsport field, there are currently no domestic corporations supplying F1.
Though the symbolism of F1 is significant, Chairman Cho is reportedly continuing to contemplate the investment costs and the risks of accidents. Official tire suppliers must invest hundreds of millions to over 100 billion won annually for product development and marketing focused on the event. If accidents such as tire failures occur during a race, it can harm brand image and make it difficult to recover the initial investment costs due to the uncertainty of contract renewal.
Currently, F1 tires have been exclusively supplied by Pirelli since 2011. Hankook Tire competed with Pirelli by passing a technical test for F1 tire supply in 2018, but withdrew its intent in the final bidding stage. In 2014, it even gave up due to insufficient product development time.