Hyundai woos US at new Alabama plant

Hyundai employees work on a car on the assembly line on Friday during the grand opening of their plant in Montgomery, Alabama. This is the South Korean car manufacturer's first production plant in the US. PHOTO: AFP

In an effort to make its South Korean cars seem less foreign to the US market, Hyundai brought out the red, white and blue for the opening of its first US plant on Friday.

Former George H. Bush was invited as a guest speaker and commended the Koreans on their contributions to the war in Iraq.

The Korean ambassador told a cheering crowd that his country would not forget the 55,000 Americans who died fighting for their freedom during the Korean War.

And Korean pop sensation Elec Cookie played a rousing rendition of Oh Susanna, the old-time country standard that opens with "I came from Alabama with a banjo on my knee."

"This new manufacturing facility reaffirms Hyundai's commitment toward investing in the US economy, as well as its commitment toward US consumers," Chung Mong-Koo, chairman of Hyundai Motor Group, said at the opening of the facility in Montgomery, Alabama.

"With this opening of the Montgomery assembly plant, Hyundai will complete its full range of automotive capacities in the US," he added. "We are able to provide full service from production to sales."

Hyundai's entry into the US market was shaken by manufacturing defects that made the automaker the butt of jokes. But after a concerted effort to improve quality -- and a massive ad campaign touting the best warranty in the business -- Hyundai has seen dramatic sales growth, up 364 percent in the past five years.

The Hyundai nameplate alone had a 2.5 percent market share in US last month, having overtaken Japanese manufacturers, including Mitsubishi and Isuzu, but also European names such as Volkswagen, BMW and Mercedes-Benz, according to figures from Autodata Corp.

With its affiliate Kia, Hyundai has a US market share of around 4 percent.

Hyundai's have been steadily growing in key quality surveys of US motorists.

"We're never satisfied when it comes to quality," said Bob Cosmai, the president of Hyundai North America.

"Being in the top 10 of 36 nameplates is pretty good but we can do better," Cosmai said, adding that Hyundai aims to be the top-rated automaker.

The Sonata sedan, designed for the US market, saw its sales jump 30 percent for 2004 to a total of 107,189. It is big enough to be classified as a large car but is sold at a lower price than most rivals, making it a key driver for the Korean firm.

Built a former cow pasture south of Montgomery, Alabama, the US$1.1 billion plant currently employs 2,000 people, of whom only 67 are Koreans. Suppliers are expected to bring another 5,500 additional jobs to this southern state.

Alabama the 7th poorest in the nation but has made a major push to rival Detroit as an automotive manufacturing center. Mercedes, Nissan and Toyota already have plants in Alabama, producing 800,000 vehicles a year. The Hyundai facility is expected to eventually produce 300,000 vehicles.