Operations Strategy : Hyundai Automotive Industry

937 WordsMay 31, 20064 Pages
Operations Strategy : Hyundai Automotive Industry Question 1. The automotive industry is one of the main ingredients of the Korean national growth. In 2004, Hyundai Motor Company had $57.2 billion in sales in South Korea making it the country 's second largest corporation. It is also the world 's seventh largest car maker. In 1998, Hyundai acquired rival Kia Motors. This acquisition brings the first element of the firm competitive strategy. The Hyundai motor company is today aiming to establish clear and distinct identities for the two brands so that they don 't compete between each other in the market. The company competitive strategy is influenced by the differenciation…show more content…
The initial operations of the Hyundai Automotive Industry were merely the assembling of parts imported from Japan and the United States. Hyundai is today among the most advanced automobile-producing countries in the world. In the 1990s, the industry manufactured several in-house models. This last fact demonstrates the capabilities in terms of design, performance, and technology, but also signalling the coming of age the Hyundai automotive company on the Korean Automotive Market. Several factors characterized Hyundai firm 's operation. First of all, Hyundai seems to have an innovative approach to supply chain management. Hyundai management team had the idea to create mini parts warehouses from Hyundai 50 largest dealers. The process then is quite complex but really efficient: Those dealers in turn ship parts to the smaller dealers on the same day, instead of overnight. The Cost savings are then incurred with a substantial reduction of air freight charges. It 's by trying to innovate that a company can develop a competitive advantage. That 's what Hyundai is doing with an innovative supply chain management process. Secondly, Hyundai 's firm operation is highly linked with the acquisition of Kia. The company is taking advantage of the economies of scale and managing not to standardise the cars and losing each brand identity. It allows the company to maintain their own brands for field full vehicle ranges and maintain individual sales and
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