Cordiant lost out following a four-way review, where its Bates USA West, Irvine, California agency competed against Publicis, Seattle; and Publicis & Hal Riney. FCB, Irvine and San Francisco, was eliminated at an earlier stage.
Cordiant shares were down 3.17% in early trading to 92.5p.
The agencies made a series of presentations to a five-member creative selection committee, which included four Hyundai executives and dealer representative Tom O'Brien of Tom O'Brien Hyundai, Quincy, Massachusetts.
Finbarr O'Neill, the Hyundai Motor America president and CEO, said: "We're very excited to be working with The Richards Group. They bring not only a broad range of advertising skills and great creative ideas, but most importantly a cohesive brand strategy for Hyundai over the coming years to help our pursuit of becoming a tier-one import car company."
Bates USA West had handled the account since 1986, the year Hyundai launched in the US.
The loss comes as a major blow to Bates, which last year lost the Korean car group's $300m media account, which was moved out of Bates and into Carat, owned by the Aegis Group.
Cordiant chairman Michael Bungey has in the past described the Hyundai business as a cornerstone of the group.
Hyundai will begin working immediately with The Richards Group to develop strategy and creative for the launch of the 2003 model year vehicles in the autumn of this year.
"We will continue to evolve our advertising approach with the 2003 model year work, to better communicate the developing brand strengths of Hyundai and its vehicles," Hyundai marketing vice-president Dave Weber said. "While it is too early to provide details of the new campaigns, as development is just beginning, we will be developing a new tagline for the brand and a new look to our advertising."
The agency will be increasing the staffing at its Seal Beach, California office to serve Hyundai. Hyundai's five regional advertising associations will shortly be meeting with the new agency to determine if they will use creative from the agency.
The agency search and review was handled with the assistance of Select Resources International of Los Angeles, California.
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