Lee Han-woo, newly tapped CEO of Hyundai Engineering & Construction (Hyundai E&C)

The appointment of Lee Han-woo, head of Hyundai Engineering & Construction's housing business division, as its new executive vice president and CEO marks a generational shift as Lee becomes the company's first CEO born in the 1970s.

Born in 1970, Lee joined the company in 1994 and has held a range of leadership roles over the past 30 years, including head of the strategic planning division.

As the incoming CEO, he is expected to enhance Hyundai E&C's global portfolio in civil engineering, plant construction, and other sectors while spearheading a paradigm shift in the industry through strategic energy investments.

"Construction companies here in the country have traditionally valued seasoned leadership, given the dominance of domestic projects," an industry insider commented. "However, to survive in this market, which is increasingly reliant on forward-thinking and global initiatives, the appointment of a leader born in the 1970s is seen a clever and progressive move."

Another industry official said Lee is seen as a leader who can "kill two birds with one stone," as he possesses both hands-on expertise and strategic planning skills.

"For large-scale builders, it has been rare to find executives with extensive experience in both strategic planning and on-site housing projects due to the distinct division between these career tracks," the official explained. "Lee's dual expertise is seen as a breath of fresh air. If he succeeds in securing new projects for the company, it could inspire other firms to embrace a similar generational shift in their leadership."

Under outgoing CEO Yoon Young-joon, Hyundai E&C made significant strides in overseas markets, securing high-profile contracts such as a 1 trillion won ($750 million) power transmission project in Saudi Arabia and a 20 trillion won nuclear power plant project in Bulgaria. By the third quarter of 2024, the company had already achieved 76 percent of its annual order target of 29 trillion won.

However, domestic challenges have loomed large during Yoon's term. The company has been hit hard by a downturn in the real estate market and a project financing crisis, exacerbated by rising construction and raw material costs.

Third-quarter operating profit plunged over 53 percent year-on-year, and cumulative operating profit for the first three quarters fell 20 percent to 512.5 billion won.

According to data from the Financial Supervisory Service, Hyundai E&C recorded the largest amount of unpaid receivables, with construction-related receivables alone totaling 4.91 trillion won -- a 47.7 percent increase from 3.32 trillion won at the end of last year. Its unsold units receivables also surged by 84.5 percent, rising to 196.7 billion won from 106.6 billion won last year.

"Following these appointments, further organizational changes in mid-December will emphasize bold personnel shifts and long-term talent development," a Hyundai Motor Group official said.

Meanwhile, Hyundai Construction's affiliate Hyundai Engineering, is also set for leadership changes, with Kia Motors CFO Joo Woo-jeong being named the new CEO. Known for his financial expertise, Joo's appointment is viewed as a move to strengthen the company's financial management.