Hyundai had only previously been involved with in the F2 of WRC, but has dropped out since 2003.
There were rumours during the introduction of the Korean Grand Prix that Hyundai will be making an appearance to the F1. There were even concept cars shown all over the internet; however, this never happened. I think it was a wise move not to have entered the grand prix, despite its popularity, I don’t think Hyundai’s brand image fits in well with F1. Yes, they will get a lot of media attention for entering, but that will phase out, and with the likes of Red Bull. Mclaren and Ferrari having the best drivers, it will be hard for Hyundai to earn a reputable position. the investment into the most expensive motorsport would have gone to waste.
Hyundai has confirm in September 2012 that they will be making a return to WRC, possibly as early as 2013.
I think rallying is definitely the best Motorsport for Hyundai to compete in. There isn’t any need to develop F1 or sporting cars as they already have previous experience in it and existing range of cars which qualifies for the championship. It can also demonstrate their new car’s durability and liability, and I think WRC is by far the best choice of competition for Hyundai. Rumors around says that the Veloster or the i20 will picked for their WRC entry.