Considering how Hyundai Motor Co has stumbled due to poor quality and labor strife, no one should accuse the South Korean automaker of timidity in its quest to expand in the US.
Hyundai's US sales soared to 346,235 cars and trucks last year, a gain of 41.7 percent. All were imports. Low price was the main reason for growth, as well as product quality that has improved from unacceptable to mediocre. Its Santa Fe small sport utility is a surprise hit in terms of value and popularity.
Hyundai now wants to build an assembly plant in the US, shortening by thousands of miles the distance from assembly lines to US dealers who have been shouting for more vehicles to sell.
Manufacturing costs in dollars will be high compared to costs in Korean won, but cost may be a secondary consideration.
Hyundai, constrained by manufacturing capacity at home, aims to sell 370,000 vehicles in the US this year. The company believes a US manufacturing presence could soothe trade tensions between the US and South Korea, just as the Japanese transplants helped pacify earlier battles between the US and Japan. Hyundai executives have been criss-crossing Mississippi, Alabama, Georgia, Ohio and other states, seeking an ideal site.
The Koreans are learning. Their business style is much more aggressive than that of the Japanese, and sometimes more impulsive. Japan's automakers take a long time making decisions, undertaking elaborate research before moving forward. The Koreans often are quick and bold, unafraid to fail, regroup and try again.
Though Hyundai isn't saying it in so many words, the company has let suppliers and others know it hopes to avoid organization by the United Auto Workers union. Ohio is a tempting site, because it would give Hyundai close proximity and access to many suppliers that already make parts for Honda Motor Co's plants in that state. Chung Mong Koo, Hyundai's chairman, is scheduled to visit Wapakoneta, Ohio, this week, according to the Yonhap News Agency, citing local newspapers.
Ohio, however, is a UAW stronghold, home to several union-represented General Motors Corp. and Ford Motor Co plants. Just because Honda has managed to fend off the UAW doesn't mean Hyundai can. Southern states could be a safer choice because of right-to-work laws; under them, if the UAW does win bargaining rights, workers aren't compelled to join the union.
Doron Levin is a columnist for Bloomberg News. The opinions expressed are his own.
The Central Weather Administration (CWA) yesterday said it expected to issue a sea warning for Typhoon Fung-Wong tomorrow, which it said would possibly make landfall near central Taiwan. As of 2am yesterday, Fung-Wong was about 1,760km southeast of Oluanpi (鵝鑾鼻), Taiwan’s southernmost point, moving west-northwest at 26kph. It is forecast to reach Luzon in the northern Philippines by tomorrow, the CWA said. After entering the South China Sea, Typhoon Fung-Wong is likely to turn northward toward Taiwan, CWA forecaster Chang Chun-yao (張峻堯) said, adding that it would likely make landfall near central Taiwan. The CWA expects to issue a land
Taiwan’s exports soared to an all-time high of US$61.8 billion last month, surging 49.7 percent from a year earlier, as the global frenzy for artificial intelligence (AI) applications and new consumer electronics powered shipments of high-tech goods, the Ministry of Finance said yesterday. It was the first time exports had exceeded the US$60 billion mark, fueled by the global boom in AI development that has significantly boosted Taiwanese companies across the international supply chain, Department of Statistics Director-General Beatrice Tsai (蔡美娜) told a media briefing. “There is a consensus among major AI players that the upcycle is still in its early stage,”
The Central Weather Administration (CWA) yesterday said it is expected to issue a sea warning for Typhoon Fung-wong this afternoon and a land warning tomorrow. As of 1pm, the storm was about 1,070km southeast of Oluanpi (鵝鑾鼻), Taiwan’s southernmost point, and was moving west-northwest at 28 to 32kph, according to CWA data. The storm had a radius of 250km, with maximum sustained winds of 173kph and gusts reaching 209kph, the CWA added. The storm is forecast to pass near Luzon in the Philippines before entering the South China Sea and potentially turning northward toward Taiwan, the CWA said. CWA forecaster Chang Chun-yao (張峻堯) said
Japanese Prime Minister Sanae Takaichi yesterday said that China using armed force against Taiwan could constitute a "survival-threatening situation" for Japan, allowing the country to mobilize the Japanese armed forces under its security laws. Takaichi made the remarks during a parliamentary session while responding to a question about whether a "Taiwan contingency" involving a Chinese naval blockade would qualify as a "survival-threatening situation" for Japan, according to a report by Japan’s Asahi Shimbun. "If warships are used and other armed actions are involved, I believe this could constitute a survival-threatening situation," Takaichi was quoted as saying in the report. Under Japan’s security legislation,
RSS