The Hyundai Motor Company, commonly referred to as Hyundai Motors, is a South Korean multinational automotive manufacturer headquartered in Seoul. Hyundai Motor Company was founded in 1967, along with 32.8% of its owned subsidiary, Kia Motors.

Hyundai operates as the world’s largest integrated automobile manufacturing operation in Ulsan, South Korea. Their annual production capacity is 1.6 million units. The company employs approximately 75,000 people worldwide. Hyundai vehicles are sold in 193 countries through 5,000 dealerships and showrooms. This case study will review the impact of Hyundai’s supply chain strategy.

In 1968, Hyundai introduced it’s first model, the Cortina, which was released in cooperation with Ford Motor Company. Hyundai wanted to develop their own car, so they hired George Turnbull in February; of 1974. George was the former Managing Director of Austin Motors at British Leyland. He in turn hired other top British car engineers. In 1975, the Pony, the first South Korean car was released with styling by Giorgio Giugiaro of ‘ ItalDesign’, and powertrain technology provided by Japan’s Mitsubishi Motors. In the following year exports began to Ecuador and soon after to the Benelux countries. Hyundai entered the British market in 1982, selling 2993 cars in their first year. In 1984, Hyundai began exporting the Pony to Canada, but not to the Untied States as the Pony would not pass the US emission standards. Canadian Sales exceeded Hyundai’s expectations. The Pony at one point was the top-selling car in the Canadian market. In 1985, the one millionth Hyundai car was built.

In 1986, Hyundai began to sell cars in the United States. The Excel was nominated as “Best Product”, due largely to its affordability. In 1988, the company started to produce other car models such as, Sonata.

In 1990, production of Hyundai reached the four million mark. In 1991, the company succeeded in developing its first proprietary gasoline engine, the four-cylinder, Alpha, and its own transmission, paving the way for technological independence.

In 1996, Hyundai Motor India Limited was established with a production plant in Irungattukottai near Chennai, India. In 1998, Hyundai began to overhaul its image to establish itself as a world-class automotive brand. In 1999, Chung Ju Yung transferred leadership of Hyundai Motor to his son, Chung Mong Koo. Hyundai’s parent company, Hyundai Motor Group, invested heavily in the quality, design, manufacturing and long-term research of its vehicles. Hyundai created a 10-year or 100,000mile (160,000 km) warranty to cars sold in the Untied States and launched an aggressive marketing campaign.

In 2000, Hyundai established a strategic alliance with Daimler Chrysler. In 2001, the Daimler-Hyundai Truck Corporation was formed. In 2004, Daimler Chrysler divested its interest in the company by selling it 10.5% stake for $900 million dollars.

In 2004, Hyundai was ranked second in “initial quality in a server/study by J.D. Power and Associates. Hyundai is now one of the top most valuable brands worldwide.

In 2006, the South Korean government arrested and charged, Chung Mong Koo, for embezzlement of $100 billion dollars. As a result, Kim Dong-jin replaced him as head of the company.

In 2014, Hyundai started an initiative to focus on improving vehicle dynamics in its vehicles. The company’s intention was to become a technical leader in both ride and handling, as well as producing vehicles that lead their respective segments for driver engagement.

Hyundai has six research and development centres, three offices are located in South Korea, one in Germany, one in Japan and one in India.

question 1.

1. What were some of the key structural and infrastructural elements that defined Hyundai’s supply chain strategy after 2000?