Nigeria - Korea's Hyundai remains unstoppable
By Moses Akaigwe
Sun News Online
The January 29, 2010 edition of the well respected Fortune international magazine, may have come and gone eight months ago, but the remarkable cover story is still being made very relevant each passing day by developments in the auto industry.
With a headline that read The Toughest Car Company of Them All, the article described Hyundai as "real", noting that though competitors hate the Korean brand, "customers love them".
And this has remained an accurate assessment, because, not only are Hyundai sales on the rise in most markets, including the United States and Nigeria (where Hyundai Motors Nigeria Limited, which is related to the multi-brand stable of Stallion Motors) the auto maker seems to be accelerating its way closer to its dream Top Four position in the global market.
Propelling this bold drive, at least for now, are two major products - the new Tucson {ix35 in some markets} and the Sonata. Tucson is currently upsetting its size and weight class just the way the Hyundai Sonata has overturned the established order among midsize sedans.
To take advantage of this momentum, Hyundai is pushing new models out of its factories faster and faster. For instance, American customers will see the slick new 2011 Sonata in December, two months ahead of schedule, because, in an unusual move, Hyundai sped up the start of production.
Despite their success, Hyundai executives keep pushing for more. The Hyundai Group currently has capacity for 5.8 million cars and trucks. "We want to grow to 6.5 million units in two years," says Steve Yang, President and CEO.
The biggest question mark today is how far Hyundai's momentum will carry it. Twenty years ago, it was on nobody's radar screen. Today it looks unstoppable. And though it is on the fast lane, it doesn't seem to be leaving room for a slip. There seems to be an eye on everything.
Here is an insight: On the second floor of the 21-story Hyundai Motor headquarters in the south of Seoul is a 24-hour operations hub, the Global Command and Control Center (GCCC). Modeled after the CNN newsroom in Atlanta with dozens of computer screens relaying video and data, it keeps watch on Hyundai operations around the world.
Parts shipments are tracked from the time they leave the supplier until they reach a plant. Cameras peer into assembly lines from Beijing to Montgomery and keep a close watch on Hyundai's giant Ulsan, Korea, plant, the world's largest integrated auto factory and the scene of frequent labour unrest.
Are competitors' spies lurking? The GCCC watches over Hyundai R&D activities in Europe, Japan, and North America, as well as its sprawling, 4,300-acre test facility in California's Mojave Desert, with its 6.4-mile oval track.
Hyundai is a confident, hyperaggressive company that not only wants to win, it expects to win. By monitoring operations in real time, Hyundai can identify problems in an instant and react quickly. It is a different philosophy for an auto company. Whereas Toyota (TM) thrives on consistency and Honda (HMC) on innovation, Hyundai is all about aggressiveness and speed.
In China, where auto sales have skyrocketed this year thanks to government stimulus, Hyundai leaped 150 percent in September, leaving the company in second place, behind Volkswagen, among international automakers. Moving quickly and boldly has made Hyundai Motor Co. the fastest-growing major automaker in the world. Amid the global sales slump, it made a record $832 million in the third quarter ended Sept. 30. Analysts expect its net profits to rise almost 40 percent this year.
Despite its relative youth - it is only 43 years old - Hyundai already ranks fifth in volume among the world's auto producers and passed 107-year-old Ford Motor (Fortune 500) in 2009 to move into fourth place. Years ago Toyota used to say that Hyundai was the company it feared most. Today those fears have grown into a nightmare.
Hyundai is making another big gamble this year by introducing in the US market a premium luxury car called the Equus that is priced thousands of dollars higher than any car Hyundai has sold before. Not an entirely new car in its home country, Korea, where yours sincerely sighted it some years back, the Equus (Latin for "horse"), expected to cost around $60,000, will cost more than most Cadillacs and is designed to compete with top-of-the-line models marketed by Mercedes, BMW, and Audi that sell for $20,000 more.
Hyundai got its foothold in the American market first by offering exceptional value, and the Tucson succeeds there. In a class that includes the Honda CR-V and Toyota RAV4, the Tucson roars in with a base price that is competitive.
Quality was the next milepost on Hyundai's U.S. journey, and the initial reports on the Tucson are excellent. The interior is especially praiseworthy, with the instrument layout and leather and cloth seats better than you would expect in this price class. The final hurdle for Hyundai is styling. The company has been leaving behind some of the more florid influences of its home market in favour of refinements on a more international look, as seen in the popular Genesis and the recently unveiled Equus.
