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
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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
Limited revenues and lack of profitability. The car industry is competitive so there are no guarantees that you will make money despite that you are marketing great cars. In Sweden they used to have this car company Saab. The cars were great - they got good reviews and top points at safety tests - but not enough customers bought them, so Saab had to file for bankruptcy and was bought by the
Private and commercial are the two purposes of the vehicle production in the industry (Ibisworld, 2013). In order to grow the revenue and profits, a new small-car production plant was build by Holden in Adelaide in 2010 (Holden annual report, 2012). Holden paid attention to become a global player depends on the GM plant in Thailand. This plant became a base to help Holden expand its reputation in Asia-Pacific region and reduce the production costs for the production (Ibisworld 2013).
They has been pioneer in car industry and in the following years will be the same and focused on coming out on top in option fuel propulsion.They need to be driving merchant inside of the
Value chain analysis looks at every step a business goes through, from raw materials to the eventual end-user. The goal is to deliver maximum value for the least possible total cost. It is a systematic approach to examining the development of competitive advantage. The most basic breakdown of primary functions includes inbound logistics, operations, outbound logistics, sales and marketing and service. People should use the other models and frameworks within this software to further differentiate between, and add to, these domains. Product Innovation is one area that is not normally included in the de jure model but is often included in the de facto model. Value Chain Analysis describes the activities that take place in
In order to identify BMW Group’s internal strengths and weakness, here applied strategic capability which combined three keys of resource: tangible resources, intangible resources, and competences. All of these resources enable a company to attain a sustainable competitive advantage (Dess et al, 2010).
Creation, acceleration and emotion are the key components for any automobile industry to deliver its goods to the expected standards. General Motors, popularly known as GM has been a pioneer in the global autoindustry for more than 100 years. Developing from horseless carriages to the latest sports cars, innovations have always excelled at putting the world on wheels. In fact, there are a lot of exciting things to share about the company. GM’s corporation started in 1892 by R.E. Olds, with a solid financial foundation, which enabled him to produce great vehicles for customers and build a bright future for employees, partners and shareholders. GM slowly initiated its staff of experts in the factories which are located in different parts of the globe and acquired the brands like Chevrolet, Pointiac, GMC, Buick, Cadillac(General Motors Corporation, 2015). Leading the way is their tailored leadership team who set high standards for the company so that they can produce the best cars and trucks. This means that GM is committed to deliver vehicles with compelling designs, flawless quality and reliability, leading safety, fuel economy and commercial features. All are intended to create that special bond that can only happen between a driver and a vehicle. General Motors is a customer driven company and aims at earning customers
Over the years, automotive industry has increasingly become a global enterprise. Every year, newer better enhance model cars are made. Some people may buy cars for just the luxury. Some may just want a car that can take them from point A to point B. Within the automotive industry it conclude either American or Foreign cars. When buying a car, one looks for fuel efficient, reliability, and style. Either way it’s really depends upon one’s choice and one’s taste.
Chapter 7: Merger and Acquisition Strategy --- The Acquisition and Restructuring of Kia Motors by Hyundai Motors (written by Seungwha Chung and Sunju Park)
There are similarities with other businesses, Hyundai is led by its company values which are
However in such a competitive market, their operations process design does not differentiate them from other car manufacturers. Their production line is designed in a very standard way for an automobile producer and does not contribute to differentiating
One of the problems faced by Malaysian Automotive Industry is reputation. For many years Proton car is always being branded as a cheap and below par car manufacturer. Due to this unwanted reputation, consumers are sceptical about Malaysian cars where it does not guarantee any assurance. Since Proton was formed in 1985, Proton managed to breakthrough in domestic and international market as an affordable car. But over the years, Proton has compete aggressively with other automotive manufacturers due to localization of many foreign manufacturers in Malaysia. Due to the localization, foreign cars has been in the market in lower prices. This makes Proton as a car that does not have resale value because the pricing of Malaysian cars depreciates rapidly each year.
It has made its name in the global market and has given a good competition to other companies in automobile sector.
KIA, which means “arise from Asia” in Korean, started out making bicycles prior to World War II (Kia Motors Corporation, 2008). The company developed the manufacturing of steel bicycle tubing into a multi-national corporation producing cars and trucks. Prior to merging with Hyundai in 1998, Kia was the second largest producer of vehicles in South Korea (Kia Motors Corporation – Company Profile, Information, Business Description, History, Background Information on Kia Motors Corporation, 2008). Examining Kia’s transformation in a country lifting itself out of the
Environment factors: The exhaustion of fossil energy sources has placed an enormous pressure on Toyota in developing replacement or hybrid engines. According to the forecast of trustworthy organization, oil sources will be exhausted in the next 50 years, gas in 60 to 70 years. Disasters has significantly influenced on automotive industry due to revenue and performance loss caused by them. Environment pollution rate should be involved in investment decision making procedures of car manufacturing companies since it can move the taxation, tariff and policies of governments. Legal factors: Automotive industry is subject to various rules and regulations as well as legislation. The legislation covers areas like competition law, consumer protection and taxation, intellectual
Hyundai automotive distributors were established in 1967. The company has displayed a high level of commitment to southern Africa’s future from both an economic and political point of view.