1. 1. CHAPTER-1
   INTRODUCTION
   This project is made on the project title Comparative analysis of consumer preference between Hyundais i-10 and Marutis wagon-R Jaipur city
   The purpose of this project is to know consumer preference about i-10 & wagon-r.
   
   • To create awareness about the i-10 features.
   • 2. To create awareness about the Vehicle of Hyundai Company.
   • 3. To create awareness & to tell the people what is importance of features of vehicle.
   Today there is a cut throat competition in the market and an Automobile industry cannot escape itself from this competition. So its became very important for every company of this industry to provide better services to aviary the comparative advantage So this project is very important for Morani Hyundai Ltd to increase the satisfaction level of its customers . So that it can retain its customer for a long time and can maintain good retains with its customer to increase its profitability with customer satisfaction
   CHAPTER-2
   AUTOMOBILE SECTORE
   Automobile Features
   Production volumes in automobile companies have grown by around 2% per year over the last 20 years; However, its relative importance in terms of market value compared to other industry sectors has decreased significantly. Today the automobile industry represents less than 2% of the total European market capitalization, while 20 years ago the sector was almost double in relative size.
   Only about 1/4 of over 50 car manufacturers who were operating 40 years ago have been able to retain their Economic independence. Despite this consolidation, overcapacity in the industry is a constant issue, keeping pricing and the return on invested capital under pressure when the cost of capital can often not be covered. A high fixed cost base ensures that companies follow a growth strategy. However, this does not mean more jobs in the sector, but rather that fewer employees in lower-cost countries have to produce more.
   As a result of tough competition, product cycles have become shorter which creates a crowded market place with newer and fresher products. This also means that 1) the competitive advantage period of a model, or technology, decreases, and 2) research & development costs have to be covered more quickly.
   Recognizing market movements first, or even creating them, is a key success factor for automobile companies. For example, early detection of the rising demand for hybrids was an important marketing move for Toyota, while other companies may be launching their hybrids when competition is already quite intense.
   The industry is mature, especially in the European and American markets, while some Asian markets (e.g. China and India) still offer some growth. Overall, demand growth is likely to stay below the nominal GDP (Gross Domestic Product) expansion rate.
   In all consumer markets, whether they are low-priced household goods, food, apparel, or cars, a clear polarization exists. On one side there are people who can afford to buy very expensive automobiles, while on the other, demand for low-cost vehicles is increasing. This trend can be expected to continue and car manufacturers have to ensure that they are not going to be lost in the middle.
   The regulatory focus on greenhouse gas emissions, as well as the increasingly tight regulations on air pollutants, is creating pressure for automakers to reduce fuel consumption, as well as emissions from internal combustion engines.
   The trend is moving towards developing drivetrains based on new technologies such as hybrids and fuel cells.
   Branding, technological leadership (especially in fuel efficient propulsion technologies and safety) and consequently differentiation, as well as good supplier relations will be the key success factors for the automobile company of the future.
   Deutsche Bank, Global Automotive Industry, The Drivers: How to navigate the auto industry, 27 August 2004.
   This Euro if sector report has been compiled with research by SAM. It describes the major social and environmental challenges facing the European automobile industry and the associated risks and opportunities these pose for long-term returns. Notwithstanding the significant potential environmental risks and opportunities highlighted in this document, the car industry has achieved significant improvements in terms of transparency over past years. Although the auto parts makers are integrated parts of the value chain, specific issues uniquely relevant to Them are not addressed here.
   Automobile Trend t - 3rd in a series
   A
   Key Challenges
   The ability of people and goods to move and to be moved in an efficient way is essential for economies to prosper. However, if current trends continue, the growth in transport activity will lead to an increase of greenhouse gas (GHG) emissions to a level that is not sustainable. There will be a substantial negative impact not only on social and environmental values, but also on economic growth.2
   The automotive sector is a major source of CO2 emissions, representing approximately one quarter of global anthropogenic GHG emissions. In order to follow the Kyoto protocol, several of the worlds major automotive markets have adopted policies to reduce vehicle-related CO2 emissions. In the typical life cycle of an automobile 75% of automotive-related emissions occur during vehicle use (19% during fuel production, 4% during the production of materials/components, and 2% during assembly work).3
   Thus, fuel economy and CO2 emission standards offer the best prospect for reducing vehicles contribution to climate change. In the European Union, a dialogue between regulators and the automotive industry trade association (ACEA) inspired a voluntary commitment from the industry to reduce CO2emissions from passenger cars to a level of 140 g CO2/km by 2008. Depending on progress, ACEA may extend the target to 120g CO2/km by 2012.
   According to the Clean Air for Europe (CAFE) programme the pollutants of most concern for human health from road transport are airborne particulate matter (PMs) which are precursors of smog and other poor air quality problems, as well as the ozone that is formed by the reaction between hydrocarbon (HC) and nitrogen oxide (NOx).While the ACEA voluntary agreement (see key challenge Fuel Efficiency & Climate Change) targets the reduction of CO2 levels, Euro 4 and Euro 5 aim to regulate the vehicular emission of PMs, HC and NOx. The Euro 4 standard came into effect in 2005. Euro 5, which could be introduced by mid-2008, has been submitted by the European Commission, although its final form is still unclear. The main priorities are to further reduce emissions of PM and No with the introduction of a limit value of 5 milligrams per kilometer for PM (-80%) and a NOx limit value of 200mg (-20%) for diesel cars. The commission is also considering proposing reductions in the emission limits for petrol cars (a 25% reduction in NOx as well as in hydrocarbons).
   In 2000, approximately 1.2 million people worldwide died as a result of road traffic injuries, and another 7.8 million were seriously injured.5 In Europe, every year road traffic accidents kill more young people aged 5 to 29 than any other cause of death.6
   The number of road deaths by inhabitant sharply rises in the early stages of motorization when people can afford to buy motorcycles first, and then cars as is happening in India and China.
   The World Health Organization in Europe considers speed as the single most important determinant for safety in road transport systems. They call for new road safety thinking that builds safety into the transport system, and improving implementation mechanisms and tools to achieve this.
   Automobile companies are very large employers. Some major companies in Europe have over 300,000 employees worldwide.
   A strong workforce provides the basis for a successful company. In order to foster their commitment, automobile companies must continually invest in training and development of their employees.
   Labor costs represent on average only about 10% of the sales price of a car while material costs are responsible for around 50%. R&D expenses will rise with increasing technical complexity of the product as well as with tougher safety and environmental regulations. Additionally, marketing costs are likely to go up as the need for differentiation will persist. Pressure to make cost elements, like labour, more flexible and to continuously restructure or even outsource part of operations is likely to increase.
   As car manufacturers are becoming assemblers, instead of manufacturers, the integration of suppliers into vehicle development and production is increasingly essential and a decisive factor in competition.
   A potential issue for car manufacturers is their rising dependence on their suppliers for innovation and quality. It is therefore necessary for the car company to integrate these criteria into the selection process.
   In the context of climate protection the western industrial nations would have to lower their GHG emissions by 60% to 80% by 2050 in order to limit global temperature increases to no more than 2C of pre-industrial levels.4 This means that GHG emissions would have to be reduced by 2%-3.5% per year. On the assumption that car traffic increases by 2% per year, efficiency would have to increase by around 4%-5%, which is significantly higher than the commitment from the European automotive industry of 140 g CO2/km by 2008.
   The tougher ACEA objectives will be substantially more difficult and costly to meet since it might require the hybridization of the drive train and more dramatic shifts in the product portfolio. To meet the target by 2008, carmakers need an annual rate of improvement of 3.3%, suggesting that they may have to accelerate the introduction of expensive new technologies to boost fuel efficiency. Carmakers recognize that this will be challenging.
   To meet current imposed carbon constraints, Original Equipment Manufacturers (OEMs) can turn to a wide range of carbon efficient measures, such as incremental technologies, alternative fuels, hybrid vehicles, and, in the more distant future, fuel cell technology. With rising oil prices, bio and synthetic fuels, which produce less GHGs than petroleum fuels, are becoming a viable alternative to gasoline and diesel. Leaders in these areas will gain competitive advantage and brand differentiation in the industry in the coming years.
   Hybrid drive trains are likely to provide an interim solution, although they do not significantly reduce emissions when driving long distances. Hydrogen-related technologies may represent a revolutionary but long-term answer as they are currently still too expensive and the infrastructure is not available yet.
   Due to the characteristics of combustion engines (for petrol and diesel), it is not possible to reduce all emissions through improved engine efficiency alone. While diesel engines have advantages in terms of CO2 emissions compared to its petrol counterparts, they produce much higher emissions of PMs, HC and NOx. Thus, this can result in a trade-off between public health impacts and climate change.
   Transforming a diesel engine into a cleaner power train requires sophisticated technology. The average cost of compliance for Euro 5 is estimated by the VDA (Verb and Detacher Automobilhersteller) at 800 per vehicle. Volkswagen puts the additional costs required at roughly 1 000 per vehicle. This is comparable to the higher material costs experienced in 2005 in terms of magnitude.
   Some auto sector analysts, however, consider these costs to have been overestimated by the automobile lobby, and quote much more manageable figures closer to 140 per vehicle.
   Companies that have market-ready, new technologies enabling compliance with tougher standards should be able to improve their short-term competitiveness.
   In the developed and developing worlds, strategies should aim at achieving significant reductions of road traffic injuries from current levels and curbing the growth rate in deaths and injuries. Either through regulation or by market forces, car manufacturers are already facing pressure to make cars less dangerous, not only for the drivers and occupants of the vehicle but also for those on the street (e.g. pedestrians, bicyclists).
   The following measures can be taken by car manufacturers to meet the EU regulations creating more space between the front grill and the so-called hard points (such as the engine) to absorb the energy from a collision ; 2) redesigning the cars hood to make it a better energy absorber and fitting the car with active safety systems such as airbags ; and 3) equipping the car with active safety systems such as night vision, adaptive lighting, active braking systems and run-flat tires to prevent accidents.
   The automobile industry has one of the highest numbers of temporary workers as a percentage of the total workforce of any sector (often 10% of the workforce in a given year but representing up to 30% during peak production periods).8 Temporary work might in some cases be less stable and as such, this category of employee cannot afford to alienate automobile manufacturers and their subcontractors, which are often the sole local employers. The abusive use of temporary employment is now taken more into account by industrial tribunals, which do not hesitate to rule against companies that overstep the mark and impose fines.
   The high number of temporary workers at automaker companies may also affect the quality and production of cars due to increased turnover of employees and lack of skills transfer.
   To attract well qualified employees and maintain a high level of motivation, automobile manufacturers should offer a positive and safe working environment including: efficient work structures with flexible working hours, measures to promote young employees, part-time employment and child care.
   The evaluation of the suppliers should not only be based on technical skills, quality of work and pricing, but also on environmental and social standards.
   Suppliers have to be managed in the same way as subsidiaries in order to make work sequences and the interface between the supplier and the assembler as efficient as possible. In this respect, it is essential for the car company to set incentives for suppliers to guarantee not only a high level of quality but also access to innovation and state of the art technology. The car manufacturer has to make sure that the suppliers manage their people and talents in an appropriate way.
   Fuel Efficiency & Climate Change Air Quality and Public Health Safety Human Resources Management Supplier
   Relations.
   Indian auto sector set for higher growth
   CMYK
   
   India is the world's fastest growing free market and the world, and India in particular, has changed since the last Auto Expo, said Union Minister for Commerce and Industry, KamalaNath. He was speaking at the inauguration
   of the 8th Auto Expo, which was held at the Lal Chowk theatre.The minister said words like globalisation, which were just buzzwords a few years ago,have now become a reality. Nath also said that unlike other parts of the world where the human resources reservoir was falling, in India it is on the rise, and augured well for the industry in particular.
   India's population demographics gives it a unique advantage in the world given that an estimated 300 million people in the age group 18-35 and an estimated 60 percent of the population is below the age of 25 years.
   India's domestic industry is slated to undergo a huge shift as the regional trade agreements and bilateral agreements, which are being signed, mean businesses have to gear up to a whole lot of new challenges.
   President, CII, YC Deveshwar said Indian manufacturing has rebounded, if the 10 percent growth in the last six quarters is anything to go by.
   Thanks to the unshackling of Indian entrepreneurship,the country has seen an
   average growth rate of six percent in the last decade.
   He spoke about the importance that is being given to quality with a majority of Deming Prize winners coming from the auto sector.
   He acknowledged the contributions of the small and medium enterprises in this effort. Highlighting some of the key challenges for the auto sector,
   Deveshwar said it was necessary to put in place a new model for Research & Development (R&D) and to take up the challenge in a bigger way, especially the aspect of clean air management.
   In his address, president, ACMA, AK Taneja said the potential of the automotive sector could be gauged from the fact that domestic passenger car market is likely to cross the three million mark by 2015, and the commercial
   vehicle sector will cross the half a million mark. This means that the auto component sector could well see sustained growth over a 10 year period.
   The inaugural meet was also attended by Madhur Bajaj, president SIAM, Mr NK Khanna of ITPO, Dr Berndt Gottschlak of theInternational Automotive
   Manufacturers Organization (OICA) and R Seshasayee, Vicepresident,CII and Managing Director, Ashok Leyland. _
   CMYK
   Audi AG has taken a step forward and launched the A4 sedan in the country today. A Mercedes C-class and BMW 3-series rival, the new A4 sets benchmarks in terms of technology and pricing. Speaking at a press conference earlier today, Audi Country Manager for India, Michael Weber said that the A4 offers a refreshing alternative for drivers who will not compromise on performance and quality and want something different
   from every other luxury car in the neighbor hood driveways.
   Audi is to offer the A4 in three engine variants. A 1.8-litre turbocharged
   petrol producing 163PS and a 2.0-litre turbo diesel punching out 140PS will form the mainstayof the model range. A third engine will be available in the S4 performance sedan, belting out a whopping 344 horsepower from a4.2-litre V8 engine. The former twowill be available with six-speed multitronic
   transmissions for the moment while no word was said about the latter.
   Besides powerful engines, Audi will also offer a vast range of technological
   gizmos to suit the upmarket buyer. Features such as ESP or Electronic Stability Program, permanent four wheel drive
   Audi drives in A4 range into Indian market
   Michael Weber, country manager, Audi at the A4 launch.
   continued on page 11 _Commerce & Industry Minister Kamal Nath with CII President YC Deveshwar.
   Athe seventh edition of Auto Enterprise was inaugurated during the 8th Auto Expo today by Jag dish Khattar, Managing Director, Marti Udyog Limited. An exclusive show for the auto ancillary and component manufacturers, Auto Enterprise 2006 is spread over 5500 sq mts. More than 250 exhibitors epresenting a wide range of auto products, including automobile components
   and accessories, Safety & Garage Equipment, Testing & Pollution Control Equipment spiced up the event. The main product lines come from Mechanical Spare parts - forged, blanked and cast, plastic injection moulding
   items and auto electrical products.The show provides a unique opportunity to the small Indian enterprises to showcase their quality and technological capabilities and find suitable partners for a guaranteed future.
   Compared to the last edition, several small enterprises have now graduated to the medium sector with some even achieving the status of 100 percent EOUs.
   Around 35 to 40 percent of them have graduated from SSI to medium scale industry. Most of the component manufacturers have been in the medium
   sector for which there is no official definition so far and may involve
   More than Rs.10 million investments in plant and machinery.
   Five to seven percent of the companies are from the upper SME
   segment in Auto Enterprise 2006.Most of the companies in the event
   directly or indirectly derive over.
   250 exhibitors at Auto Enterprise
   Audi AG has taken a step forward nd launched the A4sedan in the country today.
   
   
   Mercedes C-class and BMW 3-series rival, the new A4 sets benchmarks
   In terms of technology and pricing. Speaking at a press conference earlier
   Today, Audi Country Manager for India, Michael Weber said that
   The A4 offers a refreshing alternative for drivers who will not compromise
   On performance and quality and want something different from every other luxury car in the neighborhood driveways.
   Audi is to offer the A4 in three engine variants. A 1.8-litre turbocharged
   Petrol producing 163PS and a 2.0-litre turbo diesel punching out 140PS will form the mainstay of the model range. A third engine will be available in the S4 performance sedan, belting out a whopping 344 horsepower from a
   4.2-litre V8 engine. The former two will be available with six-speed multitronic transmissions for the moment while no word was said
   about the latter.
   Besides powerful engines, Audi will also offer a vast range of technological
   gizmos to suit the up marketbuyer. Features such as ESP or Electronic Stability Program, permanent four wheel drive Audi drives in A4 range into
   Indian market Michael Weber, country manager, Audi at the A4 launch.
   continued on page 11 _Commerce & Industry Minister Kamal Nath with CII President YC Deveshwar. Athe seventh edition of Auto
   Enterprise was inaugurated during the 8th Auto Expo today by Jagdish Khattar, Managing Director, Maruti Udyog Limited. An exclusive show for the auto ancillary and component manufacturers, Auto Enterprise
   2006 is spread over 5500 sq mts. More than 250 exhibitors representing
   a wide range of auto products, including automobile components
   and accessories, Safety & Garage Equipment, Testing & Pollution Control Equipment spiced up the event. The main product
   lines come from Mechanical Spare parts - forged, blanked and cast, plastic injection moulding items and auto electrical products.
   The show provides a unique opportunity to the small Indian
   enterprises to showcase their quality and technological capabilities
   and find suitable partners for a guaranteed future.
   Compared to the last edition, several small enterprises have now graduated to the medium sector with some even achieving the status of 100 percent EOUs. Around 35 to 40 percent of them have graduated from SSI to medium scale industry.
   Most of the component manufacturers have been in the medium
   sector for which there is no official definition so far and may involve
   more than Rs.10 million investments in plant and machinery.
   Five to seven percent of the companies are from the upper SME
   segment in Auto Enterprise 2006.
   Hyundai Group
   Address: 140-142, kye-dong, Chongno-gu Seoul 110-793 South Korea Telephone: (02) 746-1114 Fax: (02) 741-2341 http://www.hyundaicorp.com Statistics: Public Company Incorporated: 1947 as Hyundai Engineering & Construction Company Employees: 359 Sales: $75 billion (Hyundai Group 2000); $20.4 billion (Hyundai Corp. 2001) Stock Exchanges: Korea Ticker Symbol: 11760 NAIC: 423390 Other Construction Material Merchant Wholesalers; 423510 Metals Service Centers and Other Metal Merchant Wholesalers; 423620 Electrical and Electronic Appliance, Television, and Radio Set Merchant Wholesalers; 423810 Construction and Mining (Except Petroleum) Machinery and Equipment Merchant Wholesalers; 423820 Farm and Garden Machinery and Equipment Merchant Wholesalers; 423830 Industrial Machinery and Equipment Merchant Wholesalers Company Perspectives: Hyundai Corp. is preparing to leap over the world's top-ranking companies through the utilization of business network experience and know-how to create a new business model for the 21st digital era.Key Dates: 1947: Chung Ju Yung forms Hyundai Engineering & Construction Company. 1958: The company sets up the Keumkang Company to make construction materials. 1965: Hyundai Engineering & Construction begins its first overseas venture--a highway project in Thailand. 1967: The Hyundai Motor Company is formed.2001: The Hyundai Group conglomerate continues to be dismantled.
   CHAPTER-3
   Company History:
   Vision, mission & value:-
   Hyundai has experienced tremendous growth, establishing a global management and quality improvement system, based on our midand longterm vision of " innovation for customers."Hyundai has been selected as one of the top 100 global brands three years in a row and has now truly become a global automobile maker, receiving positive reviews from many independent evaluation agencies and the mass media. Hyundai has also increased productivity, completing the construction of its second plants in China and India. We have also shifted our global management into higher gear by successfully generating sales of a strategic car targeted at the European market. In 2008, Hyundai will build the foundation to become the best automobile company in the world by strengthening our management internally and by reinforcing our global competitive edge externally. In order to carry this out, we will focus on three areas. First, Hyundai will build a solid foundation for customeroriented management. By engaging in management activities that put customers first in all areas, including R&D, production, marketing, sales, and maintenance, based on the highest quality products and continuous quality management, Hyundai will increase its public brandimage awareness and profits. Second, Hyundai will strengthen the effectiveness of our marketing efforts in order to become a leader in the global marketplace. Through brand value improvement and targeted marketing efforts, Hyundai will deliver the worlds highest quality automobiles to its customers. Third, Hyundai will continue to fulfill its social responsibilities as a leading global company, contributing to the development of a more prosperous world community. Furthermore, Hyundai will prepare for a sustainable future by developing and distributing new environmentallyfriendly vehicles on a continuous basis. Once again, I would like to thank you for your support. Hyundai Motor Company is ready to be reborn as a top automobile manufacturer by continuing to establish a globallyfocused approach to management. We promise you that Hyundai will always take bold and confident steps for our customers worldwide.
   The Hyundai Group spent most of its history operating as one of South Korea's largest chaebols, or conglomerates. The group displayed spectacular growth since its founding in 1947 and its rapid expansion--to a point where its interests included car manufacturing, construction, shipbuilding, electronics, and financial services--reflected the achievements attained during South Korea's economic miracle. The South Korean economy took a turn for the worse during the late 1990s, however, which prompted President Kim Dae Jung to launch a series of reforms aimed at dismantled large, often corrupt, chaebols. By 2001, much of the Hyundai Group had been dismantled. Roh Moo Hyun, elected President in 2002, continues to reform the South Korean business sector.
   Hyundai's growth was linked inextricably to South Korea's reconstruction programs following World War II and the Korean War as well as to the state-led capitalism that resulted in a polarization of the country's corporate structure and the domination of the economy by a number of conglomerates. World War II left the country devastated, and the small recovery Korea had been able to make following this conflict was reversed during the Korean War, which lasted from 1950 to 1953. The chaebols, which are similar to Japan's zaibatsu, worked with the government in rebuilding the economy and formed an integral part of Korea's economic strategy and its drive to build up its industrial base.
   One man, Chung Ju Yung, stood at the center of Hyundai's progress from 1950 until he died in 2001. Chung, considered a founding father of the Korean chaebol structure, left school at an early age and developed what has been described as an autocratic and unconventional management style. He noted those areas of industry that the government had selected as crucial to economic development and structured the group accordingly.
   Explosive Postwar Growth
   The foundation of Hyundai was laid before the Korean War, in 1947, when Chung set up Hyundai Engineering & Construction Company. The company was involved in the early stages of the country's recovery following World War II. After the Korean conflict, development intensified, and Hyundai was quick to take on a key role, working on civil and industrial projects as well as housing programs. In 1958, it set up Keumkang Company to make construction materials; four years later, when the first of Korea's five-year development plans was launched, Hyundai was well placed to win a range of infrastructure contracts. This plan and its successors aimed to lay the foundations for an independent economy by targeting sectors of industry for expansion.
   Against this background, Hyundai expanded its construction and engineering operations as the economy's momentum increased. In 1964, it completed the Danyang Cement plant, which in 1990 produced well over one million tons of cement. In 1965, the company undertook its first overseas venture with a highway-construction project in Thailand. Hyundai expanded rapidly overseas, developing a market with particular success in the Middle East. Its projects in this region included the $931 million Jubail industrial harbor project in Saudi Arabia.
   In 1967, the group took one of its most significant steps, setting up the Hyundai Motor Company and thus sowing the seed for what was to become the country's leading domestic car manufacturer. Initially the company assembled Ford Cortina cars and Ford trucks. Two years later, Hyundai took another step abroad with the establishment of Hyundai America, incorporated in Los Angeles, to work on housing complexes and other civil projects. In 1970, it further enhanced its position in the construction sector by setting up Hyundai Cement Company to deal with increased demand at home and overseas.
   Toward the end of the 1960s, the government had begun to promote the heavy and chemical industries. Oil and steel were both targeted. The planners then turned their attention to the consumption of indigenous steel and focused on shipbuilding, which was then relatively backward (producing only coastal and fishing vessels), and on the automotive industry. The ambitious plans for these industries were to be of great significance both to Hyundai and the nation as a whole, and the 1970s proved to be a period of rapid development.
   Expansion into Shipbuilding: Early 1970s
   Hyundai's entry into shipbuilding would eventually take Korea's shipbuilding industry to second position in the world, behind Japan. In 1971, Chung decided to begin shipbuilding, and by the following year the company's shipyard had held its ground-breaking ceremony in Mipo Bay, Ulsan, on the southeastern tip of the Korean peninsula. In the following year the yard was incorporated as Hyundai Shipbuilding and Heavy Industries Company.
   The Ulsan yard was still at the planning stage when Hyundai won its first contract, for two oil tankers, from Livanos, a Greek shipowner. The order paved the way to a loan from Barclays Bank of the United Kingdom. Chung had to borrow capital from foreign banks to build the yard, which was opened in 1974. In the following year, the Hyundai Mipo Dockyard Company was set up to do conversions and repairs.
   This sector developed rapidly throughout the 1970s, but the group was hit by the first oil crisis and the consequent decline in demand for large tankers. Hyundai, however, quickly won four orders for large tankers from the Japanese, its main competitors, and concluded technical cooperation deals with Kawasaki Heavy Industries of Japan and Scott Lithgow of the United Kingdom. Before the market collapsed, 12 large tankers were built at the yards.
   This collapse forced Hyundai to turn to the building of medium-sized vessels. It also took steps to remain abreast of technological developments in the industry and to develop spin-offs. In 1975, Hyundai Shipbuilding and Heavy Industries created an industrial-plant and steel-fabrication division, and in the following year began to produce marine engines carrying famous names such as Sulzer and B&W.
   A further collaboration was clinched in 1977 with Siemens, of West Germany, which led to the creation of the electrical-engineering division. In the following year the company changed its name to Hyundai Heavy Industries Company (HHI) to reflect its diverse operations. At the same time it incorporated its engine and electrical engineering divisions into Hyundai Engine and Machinery Company and Hyundai Electrical Engineering Company, respectively.
   Focusing on Auto Production: Mid-1970s
   One of the most significant moves in Hyundai's relatively short history was made in 1975, when the group began constructing an integrated car factory adjacent to its heavy-industry complex at Ulsan. It was to be the foundation of Korea's largest auto company, one that was to dominate Korea's home and export markets. By the late 1980s, UBS Phillips and Drew Global Research Group ranked Hyundai 13th in the world auto industry, with the production of 819,000 vehicles and 1.9 percent of the world retail market.
   The aim of this ambitious project was to move away from car assembly only and to produce, with government backing, a Korean car, a four-seat sedan called the Hyundai Pony. To this end, it called on overseas expertise and finance, a policy used not only by Hyundai but by other Korean industrial groups as well. George Turnbull, a former managing director of British Leyland, who was then vice-president of Hyundai Motors, was in charge of the project. The car was styled by the well-known Italian designer Giorgetto Giugiaro, was powered by a Mitsubishi Motor engine, and used U.K. components. The project was financed largely by U.K. and Japanese sources.
   The vehicle was launched in 1975. By the following year, Hyundai was producing 30,000 cars, and by 1979 the total had risen to 110,000. Although Hyundai could sell every vehicle it produced in the protected home market, it soon sought to attack export markets by reserving approximately one-fifth of its production for overseas sale. The company first tested the European market, and its potential for sophisticated markets, by setting up a network of dealers in the Benelux countries, where there were no dominant local manufacturers.
   Other areas of the group saw intense activity throughout the 1970s. In 1975, Dongsu Industrial Company, a construction-material manufacturer, was created, followed in the same year by Seohan Development Company, a welding and electrode carbide maker. Since it was so heavily reliant upon exports and several essential imports, the group in 1976 set up Hyundai Corporation, its trading arm. The corporation integrated the group's sales and marketing strategies, imported natural resources through overseas investment and joint ventures, and provided assistance to overseas operations. The corporation eventually led the numerous member companies of the group in sales. At the same time, it created Hyundai Merchant Marine Company, which concentrated on cargo services, chartering, brokerage, and related services. The trading arm proved to be an important source of revenue and quickly grew into one of the country's top exporters.
   In the same year, on the construction side, Hyundai formed Koryeo Industrial Development Company and Hyundai Housing and Industrial Development Company, whose operations included construction design and property development. Hyundai Precision and Industry Company was created in 1977. Its activities included auto parts, container manufacture, and locomotive parts.
   A year later the group turned its attention to the timber industry with the formation of Hyundai Wood Industries Company, which made wood products and furniture. In 1978, the group expanded its heavy and chemical industries to include iron and steel manufacturing when it absorbed Incheon Iron & Steel Company and Aluminum of Korea.
   Tough Times for HHI: 1980s
   The 1980s brought problems for HHI. Two of its key businesses, shipbuilding and overseas construction (the development of which had been actively encouraged by the government in the 1970s), encountered worldwide decline during the decade. Korean shipbuilders saw new export orders in 1985 slump to only $522 million, compared with $2.3 billion the year before, while profits plummeted. Overseas construction orders also fell away quickly after reaching a peak of more than $13 billion in 1981 and 1982.
   In both cases, Korean industry had to discard its policy of growth at any price. There were job cuts and a move toward more sophisticated projects such as industrial plant construction and improved technology. In addition, the company had to contend with damaging labor strikes, which hit its shipyards and other parts of the group, notably the car factories. HHI instituted major productivity improvements at the beginning of the decade and stepped up its diversification with the creation of the Offshore & Steel Structure Division in 1980. Through this division it launched a major drive into the offshore market, into which it had broken in the late 1970s with orders for the Jubail project in Saudi Arabia. The division initially operated one yard, but, as demand increased, a second was added in 1983.
   In 1982, HHI took over three dry docks from Hyundai Mipo Dockyard Company, which brought the total it operated to seven. Hyundai Mipo, which looked after the company's ship repair and conversion business, was reorganized and moved to a new repair yard two kilometers away from HHI. A year later HHI undertook further reorganization by turning its maritime-engineering division into the special and naval shipbuilding division, which now concentrates on building naval craft such as destroyers, frigates, and patrol boats.
   The increased emphasis on new technology and innovation was reflected in the setting up of Hyundai Welding Research Institute in 1983--whose work has since been extended to take in factory automation--and the creation of a research-and-development center, the Hyundai Maritime Research Institute, a year later. Work continued on developing products such as the new generation of very large crude carriers, the world's first semi-submersible drilling rig, delivered in 1987, and a mixed container-passenger vessel for a Norwegian operator in 1988. The company also broke into the gas-carrier market in 1986.
   The latter part of the decade was clouded by strikes that were to tarnish the Korean shipbuilding industry's image. In addition, the company had to contend with higher wage costs that blunted the competitive edge it had over its Japanese rivals. HHI also became embroiled in a legal wrangle with Sir Yue-Kong Pao's World-Wide Shipping Group in 1988. The dispute was over an order for very large crude carriers, which it had agreed to build in 1986 when the market was in a trough.
   The strikes that affected the Ulsan yard in the latter part of the 1980s hit production and sales, and in 1988 HHI was to record its first-ever loss, that of W29 billion on sales that declined slightly to W945 billion; this came after breaking even the previous year. In 1990, the yard was hit by further strikes, although it managed to land a $600 million order for ten combination vessels from a Norwegian shipping group.
   Challenges for Hyundai Motor in the 1980s
   The 1980s were to prove equally eventful for Hyundai Motor Company. After the oil shock of 1979, the government took steps to protect the industry, which had by then made large investments in plants and equipment. It kept a tight grip on the development of this sector and in 1981 divided the market, restricting Hyundai to car and large commercial vehicle manufacture. These regulations were revised in 1986 following the recovery of the market, and Hyundai was able to resume manufacture of light commercial vehicles.
   By the middle of the decade, Hyundai had taken Canada by storm. Its Pony subcompact vehicle became Canada's top-selling car less than two years after entering the market. Hyundai's sales in Canada, where it was also selling the Stellar, shot from none in December of 1983 to 57,500 units in the first nine months of 1985, topping those of Honda and Nissan combined. Total production in 1985 had risen to 450,000.
   In 1985, the company announced plans to build a car assembly plant at Bromont, near Montreal, and at the same time decided to enter the U.S. market. The entry into the U.S. market, begun in 1986, proved an immediate success. Its low-priced Excel model was well received, and of the 302,000 cars exported in that year, 168,000 were sold in the United States, where sales were to increase to 263,000 the following year. Hyundai's initial success in the United States, though, faded before the end of the decade when sales began to flag. Problems in the company's key overseas market were attributed to the lack of new models, increasing competition in the weakened U.S. car market, and the severe strikes that hit the company in the latter part of the 1980s and in 1990.
   Hyundai decided to move up market with the introduction of the Sonata, a four-door sedan, in late 1988; initial sales, though, proved disappointing. A year later, this car was being manufactured at the Bromont plant, following the opening of the factory in 1989. In the same year, Hyundai signed a deal with Chrysler Corp. to build 30,000 midsize, four-door cars for the U.S. company, starting in 1991. Chrysler was linked to Mitsubishi Corporation, which in turn was affiliated with Hyundai, in which it held a 15 percent stake.
   Hyundai planned to increase production at the Canadian plant to 100,000 by the time the Chrysler deal came into effect. Export sales, which were also hit by the appreciation of the won and the depreciation of the yen, remained sluggish. Increased wage costs also affected the group but had the advantage of boosting domestic sales that, for the industry as a whole, increased 50 percent to 356,000 units in 1989.
   Hyundai in the Early 1990s
   The group became intent on reducing its dependence on the U.S. markets. By 1990, the domestic market was proving increasingly important to the essentially export-oriented group. Both the car and construction markets were enjoying strong demand at the end of the decade. This situation helped Hyundai Engineering & Construction, like the vehicle operations, to take up the slack created by declining markets abroad, particularly in the Middle East. The group had accumulated experience in a broad range of plant construction, including Korea's first nuclear power plant. Meanwhile exports in the shipbuilding sector were showing a marked improvement.
   Following the creation in 1983 of Hyundai Electronics, Hyundai stepped up its presence in the electronics field and produced semiconductors, telecommunication equipment, and industrial electronic systems. The company, which focused on industrial markets, sought to increase its presence in consumer electronics, despite formidable competition from domestic companies such as Samsung and Goldstar.
   The group as a whole had proved itself capable of taking diverse markets by storm and was determined to maintain and expand its markets by stepping up research-and-development spending. However, the country's drive towards democracy brought new uncertainties. In the changing economic and political environment, the group faced a labor force seeking higher wages, a less competitive currency, and increasing competition in the all-important overseas markets.
   Faced with this changing political scene and a less favorable international rate of exchange, Hyundai shifted gears in the early 1990s. In automaking, its largest enterprise, it worked to regain lost ground in the United States, where demand for its low-priced Excel and somewhat higher-priced Sonata models slumped in the wake of widespread consumer complaints and a depressed entry-level market. Hyundai's new Elantra sedan, selling for $9,000, was to be its lead item in the U.S. market. The group's chairman at that time, Chung Ju Yung's younger brother, Chung Se-yung, was expecting a new day for the group, as Korea itself matured with new labor and political freedoms.
   As Korea's second-largest conglomerate, with 1990 revenues estimated at $35 billion, Hyundai Group was clearly to play an important role in the new Korea. Indeed, the Hyundai founder and chairman, Chung Ju Yung, chose personally to play a new, political role in that development, founding a new political party early in 1992 with a view to promoting open-market policies. Chung's Unification National Party (UNP) promptly won 10 percent of National Assembly seats; Chung himself then retired from his Hyundai chairmanship to set his sights on the Korean presidency. The Hyundai conglomerate, already forced by the government to pay billions in back taxes, came under even more severe government pressures after Chung formed his party. Regulators charged illegal political contributions by one Hyundai company and accused others of tax evasion. In addition, Hyundai's ability to finance its operations was threatened by other government actions. In return, Hyundai, at this time headed by Chung Se Yung, threatened to withhold huge investments planned for the coming year. In 1993, having finished third in South Korea's presidential election, Chung Ju Yung reportedly said that he would resume chairmanship of the Hyundai Group and would reorganize the corporation into many specialized, independently run companies. In 1995, his second-eldest son, Chung Mong Koo, was named chairman of the group while Chung remained honorary chairman.
   In auto and personal-computer sales, Hyundai companies moved aggressively. In mid-1992, Hyundai's new Motor America president, Dal Ok Chung, took over in the Fountain Valley, California, headquarters. Among other marketing devices, Hyundai offered generous rebates and free two-year service warranties that covered even windshield wiper blades. By early 1993, Hyundai was offering the first auto engine it had designed and made itself, as opposed to the Japanese-made Mitsubishi engines that were used in its earlier models. More than ever committed to the smaller vehicle, Hyundai was selling autos in more than 100 countries.
   In personal computers, Hyundai in mid-1992 took a drastic step when it moved its entire electronics operation to the United States, the world's largest computer market. Hyundai Information Systems had already entered the direct personal-computer market, cutting prices and offering toll-free telephone support and sales. The new operation, based in San Jose, California, had entirely American leadership, headed by IBM veteran and former CompuAdd president Edward Thomas. The California advantage was mainly proximity to the market, which meant lessened inventory requirements. These developments showed the Hyundai Group to have the same innovative and energetic approach that had characterized its earlier ventures.
   The Dismantling of Hyundai
   The latter years of the 1990s brought with them economic turmoil for South Korea. In order to restore the nation's financial health, President Kim Dae Jung, who took office in 1998, launched a series of restructuring programs designed to reform the chaebols, many of which had become heavily debt-burdened. His reforms included changing the ownership, business, and financial structures of the region's large conglomerates. By this time, the Hyundai Group was responsible for approximately 20 percent of Korea's GDP. As such, its financial health was directly related to South Korea's overall economic condition.
   As a result of government pressures, Hyundai and other South Korean chaebols, including the Daewoo Group, set plans in motion to sell off many of their businesses in order to pay down debt and shore up profits. Hyundai's concentration remained on autos, electronics, heavy industry, construction, and finance. Even as the group struggled under its debt load, it strengthened its holdings with the purchase of Kia Motors Co. Ltd. and LG Semiconductor.
   Despite the government's involvement, Hyundai was slow to comply with restructuring demands. Its questionable accounting practices often made it the target of negative publicity. Rivalries between members of the founder's family also led to bad press, leaving many investors anxious about the future of the group and its member companies. Indeed, many Hyundai affiliates, including Hyundai Engineering & Construction and Hyundai Electronics, were nearing bankruptcy as debt continued to spiral out of control. By 2001, total group debt reached W35.87 trillion ($25.59 billion).
   Hyundai Motor Co., on the other hand, was prospering as Korea's largest car maker. The auto concern officially separated from the Hyundai Group in September 2000, signaling the start of sweeping changes that led to the eventual dismantling of what was once South Korea's largest conglomerate. In August 2001, nine core Hyundai companies, including Hyundai Engineering & Construction and Hynix Semiconductor Inc. (formerly known as Hyundai Electronics Industries), left the chaebol. The separation cut Hyundai Group's assets to just $20.8 billion and left it in control of 18 member companies. Hyundai continued to be pared down the following year.
   South Korea had bounced back from its economic crisis of 1997 and 1998 to become a leading global force in the technology sector. By 2003, foreign investors owned over a third of the shares of companies listed on Seoul's stock exchange. During 2002, Roh Moo Hyun was elected president of South Korea. Feeling the pressure from foreign investors, he maintained that harsh reform would continue within South Korea's chaebols. A May 2003 Business Week article supported the efforts of the new president, who stated that " slowly and steadily, good governance has been asserting itself in Korea."Indeed, it appeared as though the powerful, family-run Korean chaebols were a thing of the past. While this marked an end to the Hyundai Group's history, it pointed to a fresh start for many companies bearing the Hyundai name.
   Principal Competitors: LG Group; Samsung Group; SK Group.
   left0HYUNDAI MOTOR COMPANY HISTORY: A MODERN RENAISSANCEHYUNDAI FOUNDER, JU-YUNG CHUNGHyundai founder, Ju-Yung ChungThe beginning of Hyundai Motor Company dates to April 1946 when founder, Ju-Yung Chung established Hyundai Auto Service in Seoul, South Korea at the age of 31 years. The name Hyundai was chosen for its meaning which in English translates to modern. The Hyundai logo is symbolic of the company's desire to expand. The oval shape represents the company's global expansion and the stylized " H"is symbolic of two people (the company and customer) shaking hands.Hyundai Motor Company was founded by Ju-Yung Chung and younger brotherSe-Yung Chung in December 1967. In 1968 the company entered into a contract with Ford motor company to assemble the Ford Cortina and Granada for the South Korean market and continued to produce them until 1976. Hyundai completed construction of the Ulsan plant in six months and achieved the shortest groundbreaking to first commercial production of any of Fords 118 plants. The eight year journey provided Hyundai with assembly knowledge, blueprints, technical specifications, production manuals, and trained Hyundai engineers.The new Ulsan Hyundai plant just prior to opening in 1975 is already producing the Pony Fuel tank inversion testing at MIRA in the U.K. circa 1977 Work begins on the design ofPony 2 with this wood modelTHE FORMATIVE YEARSTo stimulate economic growth, the South Korean government formulated a detailed plan for the development and manufacture of Korean cars by 1975. Four Korean companies: Hyundai, Daewoo, Kia, and SSangyong accepted the challenge. Hyundai submitting a plan for a new plant with a capacity of 80,000 Korean designed cars to be produced each year. Hyundai approached 26 firms in five countries to acquire the additional technologies required.10 firms in Japan and Italy for car design 4 firms in Japan and the United States for stamping equipment 5 firms in the United Kingdom and Germany for casting and forging equipment 2 firms in Japan and the United Kingdom for engines 5 firms in the United States and United Kingdom for automotive parts Giorgetto Giugiaro's ItalDesign firm was hired for styling and design while Mitsubishi was selected for engine, transmission, rear axle, and casting technology. Hyundai contracted with former British Leyland Motor Corp president, George Turnbull and six other British technical experts to serve for a three year period for the development of Hyundai's first indigenous model, the Pony.Production began in 1975 and the Pony was officially released in 1976. After the contract with the British experts ended in 1977, Hyundai hired moonlighting Japanese engineers to solve remaining issues. With the eventual goal to export automobiles to the United States, Hyundai released the Pony for testing, certification, and approval in Europe. Exports of the Pony soon followed and the Pony subcompact was displayed at the 1978, 56th International Automobile Expo in Brussels. That same year, Hyundai exported their 10,000th Pony.Working toward export approval in Europe and eventually the U.S., Hyundai participated in the 56th International Automobile Expo in BrusselsThis 1978 photo commemorates the 10,000th Pony export. These are bound for Chile.1975 Hyundai Pony1977 Hyundai Pony Wagon1987 Pony II Pickup with a hemi engine 1985 Hyundai Pony 2Hyundai made the most of the Pony design as it was available in several configurations. A Pony pickup was introduced in May 1976, a station wagon in April 1977, and a three door hatchback in March 1980. A refreshed Pony II was released in January 1982 in a choice of five door hatchback or pickup. Both the Pony and Pony II offered three Mitsubishi engine choices including a 1.2L, 1.4L (70 hp), and a 1.6L (74 hp). These engines were SOHC hemispherical with two vales per cylinder. Starting in 1985 the HD badging was replaced with Hyundai spelled out and air conditioning was offered with the 1.6L engine. It is interesting to note that a 1.6L GT package included a leather-wrapped Momo steering wheel, tachometer, fog lights, and unique badging. While Hyundai only expected to export 5,000 Pony IIs to Canada in 1984, over 50,000 were sold.1983 Hyundai Stellar 1986 Canadian spec Hyundai Stellar 1989 Hyundai ExcelFor the next few years, Hyundai applied the knowledge gained from the Pony and set to work on two new projects. One was a subcompact Pony replacement that would come to be known as the Excel. The other was a compact sedan to replace the Ford Cortina and would be badged the Stellar. The 1983 Stellar made use of the rear wheel drive Cortina chassis, but wore a body designed by Giorgetto Giugiaro. Many luxury options were offered such as power windows, locks, and mirrors, remote fuel door and trunk, and air conditioning. Likewise several engine choices were offered including 1.4 and 1.6 liter models licensed from Mitsubishi. In 1987 the Stellar II was released with a redesigned 2.0L engine. The original Stellar's double wishbone suspension was changed to a MacPherson strut design. Emission restrictions prevented the Stellar from reaching the United States, but it was exported to Canada and other countries.The 1985 Excel (also known as the Pony, Presto, and a similar Mitsubishi Precis) was Hyundai's first front wheel drive automobile and was produced until 1994. With the Excel, Hyundai finally earned their much sought approval to enter the United States automotive market in 1985. The Excel was offered in two formats: a three door hatchback and a sedan. In addition to a lengthy list of features, the Excel held a starting price of less than $5,000. Forbes magazine named it one of the top 10 products of the year and the Excel sold a staggering 126,000 vehicles that year, more than any other import. A facelifted second generation Excel was sold from 1990 to 1994. Mitsubishi engines were available in 1.3, 1.4, and 1.5 liters.A 1985 US EPA document, providing Hyundai with approval to enter the US market.This 1986 photograph shows Excels being loaded for the first export to the United States. 1,050 Excels are queued for the journey.1986 U.S. Excel Hatchback advertisement (click for a larger version)1986 U.S. Excel sedan advertisement (click for a larger version) 1992 second generation Excel (click for a larger version)1986 Hyundai Grandeur / Mitsubishi Debonair was a Hyundai/Mitsu joint venture Asan, Hyundai's third plant in the process of construction in August 1989.RAPID EXPANSION AND GROWING INDEPENDENCEIn 1986 for the follow-on to the Ford Granada sedan, Hyundai rebadged the Mitsubishi Debonair as the Hyundai Grandeur. The first generation Grandeur was offered until 1992 when Hyundai partnered with Mitsubishi to develop the next generation (which became the third generation Mitsubishi Debonair). Hyundai designed the body and trim while Mitsubishi was tasked with the powertrain.The success of Excel led to plant expansions at home and abroad. Design on a new Korean plant in Asan began in October 1988 and the 40 acre plant was opened in 1990 at a cost of 250 billion won. Asan specialized in sedans including Sonata and XG/Grandeur. In North America, Hyundai opened a plant in Bromont, Quebec, Canada. Over the years the Ulsan plant grew to cover over 4.8 million square meters making it the largest automotive plant in the world. Ulsan is production home of the Getz, Accent, Elantra, Coupe, Santa Fe, Trajet, Matrix, H-1, H-100 and Terracan. Another Korean plant in Chunjoo specializes in trucks, buses, and specialty vehicles.During this rapid period of growth, Hyundai leveraged other Hyundai divisions to optimum advantage. This included electronics, robotics, steel stamping, and even Hyundai's massive shipyards.Hyundai's first in-house design, the 1989 Sonata included a Mitsubishi licensed engine but with Hyundai's own multipoint fuel injectionHyundai Scoupe included the first engine designed in Korea. 1991 Elantra was powered by the 1.6L DOHC Beta engineAs Hyundai's engineers gain more experience, they continue to implement more of their own technology and refinement. This work and the new Asan plant culminate in Hyundai's first entire automobile using their design and technology: the first generation, 1989 Sonata. Designed with the North American market in mind, the first generation Sonata was styled by Giorgetto Giugiaro's ItalDesign firm. Some were manufactured in Korea and some in the Quebec plant. Multiple Sirius engine choices (including SOHC and DOHC options) were offered for various markets. It should be noted that the engines still implemented Mitsubishi design elements. American models were originally offered with a 2.4 liter inline 4 with 110hp, but a 3.0 liter V6 was introduced in 1990. Other markets received either a 1.8 liter (95hp) or 2.0 liter (131hp) engine. Also in 1989 a sport coupe version of the Excel was introduced as the Scoupe (project code SLC). The Scoupe sold relatively well and was notable as being the first use of Hyundai's advanced in-house designed, Alpha engine. Available in both naturally aspirated and turbocharged versions, the Alpha was the first engine designed in Korea. The original 1.5 liter SOHC engine was later made in a smaller 1.3 liter version. The Alpha was later used in the Accent and Kia Rio. The Scoupe was sold until 1994.Anxious to switch to in-house designs, the short-lived Stellar was replaced by the Elantra compact sedan in 1991 (project code J1). The Elantra is also known as the Avante (2nd generation) and Lantra. The name Lantra arose because Mitsubishi briefly complained that Elantra was too similar to their Elante trim level. Lotus also complained of the similarity to the Elan moniker. Note: the Elantra survived longer than the Elante or Elan and Elantra became the official name worldwide in 2001. The Elantra was powered by the 1.6L inline 4 cylinder Beta engine featuring a cast iron block and aluminum DOHC cylinder heads, MFI fuel injection, 4 valves per cylinder, and forged steel connecting rods. It produced about 114 hp at 6,000 rpm. The top speed was 116 mph andit made 22 mpg/city.Second generation 1993 Sonata The second generation Elantra was sold briefly as a wagonThe second generation Sonata was introduced in 1993 (project code Y2) featuring a more modern shape reminiscent of the Mazda 626 and Honda Accord. Engine choices included a 2.0L inline 4 and an optional SOHC Sigma 3.0L V6 producing about 150 hp. This Sonata was originally produced in both South Korea and Canada but mostly due to falling sales, the Bromont, Quebec plant was shuttered in 1994.A second generation Elantra debuted in 1995 (project code RD) in sedan and station wagon styles. Engine choices included the 1.6 and 2.0L Beta as well as a 2.0L turbodiesel (not in the U.S.). The Elantra was facelifted in 1998.The Accent subcompact was introduced in 1995 (project code X3) to replace the Excel. It is also known as the Pony, Excel, Verna, and Brisa. The Accent was extremely popular in Australia and is still rated as one of the most popular imports of all time. In 1998 it achieved a 5.5% share of the Australian market. A second generation, larger Accent was introduced in 2000. Several Alpha engine choices were available including the 1.5L SOHC inline-4 with 92 hp, 1.5L DOHC inline-4 with 101 hp, and the 1.6L DOHC with 104 hp.Introduced in 1995, the Accent replaced the Excel and was a very popular export especially in Australia.A 1999 Dynasty. For about seven years the Dynasty was sold in a few markets.Hyundai introduced a large, premium sedan in 1996, the Hyundai Dynasty. It was only offered in a few markets but was produced until about 2003 and offered a choice of the Sigma 3.0 and 3.5L V6 producing 205 and 225 hp respectively. The Sigma has a cast iron block and aluminum DOHC cylinder heads with MFI fuel injection, 4 valves per cylinder, and forged steel connecting rods. Note: this engine also powers the 2001 Kia Sedona minivan, Santa Fe, XG350, Kia Amanti, and Kia Sorento.After a one year break, the 1996 Tiburon replaced the Scoupe.After a short break following the end of Scoupe production, Hyundai introduced a new coupe in 1996, the Tiburon (project code RC). In various markets, it is also known as the Coupe, Turbulence, and Tuscani. It was initially offered with a choice of a 1.6 or 1.8L Beta engine with 114 or 129 hp respectively. The Tiburon was first introduced to the United States in 1997 with a 1.8 or 2.0L Beta engine. The 2.0L produced 135 hp. A redesign in 1999 offered a newer 2.0L Beta engine.The third generation 1996 Sonata incorporated more European design elements Fourth generation 1999 SonataSonata's third generation release in 1996 (project code Y3) reintroduced European design elements with a more upmarket look. As with the previous generation an inline four was offered as well as the 3.0 liter Sigma V6. However, it was the fourth generation released in 1998 (1999 in the United States) that the Sonata began to take off in North America. The European styling influence remained, and the design was acknowledged by members of the press as attractive and original. Four engine choices were offered including 1.8L, 2.0L, 2.4L, and an impressive Delta 2.5L V6 producing about 170 hp. This introduction coincided with the 10 year, 100,000 mile warranty in the United States.A subcompact economy car, the Hyundai Atos was introduced in 1997. It is also known by the names Atos Prime, Amica, Dodge Atos, Santro, and Kia Vista. A second generation version was introduced in 2003.ASIAN FINANCIAL CRISISAsian financial markets and companies faced a difficult period at the end of the 20th century. Some smart companies like Hyundai made the best of a very difficult situation. It was during this time that Hyundai reduced its workforce and sold a number of assets. Kia Motors was faltering and did not have the resources needed to continue. In 1998 Hyundai Automotive purchased a significant amount of Kia anticipating the synergy of the combined competitors.Hyundai's largest and luxurious sedan was introduced in 1999 as the Equus and is sometimes called the Centennial. It was based upon the front wheel drive Mitsubishi Proudia. A redesign is due in 2006 with rear wheel drive and an optional V8 engine. A version is expected to be released in the United States to gauge public reaction to a luxury Hyundai line.In his drive to build the world's largest car and truck company, DaimlerChrysler Chief Executive Jrgen Schrempp purchased a 10.5% stake in Hyundai Motor in June 2000 with the plan to build small cars and 100,000 trucks a year in a 50-50 joint venture.The facelifted 2002 Elantra GT featured sportier handling and leather seatingThe Elantra appeared in its third generation in 2000 (project code XD). The wagon was no longer available and was replaced with a 5 door hatchback. While it bares a compact exterior, the EPA classified it as a midsize because of the generous room inside. The 1.6 and 2.0L Beta engines provided good power and fuel economy rated at 27 mpg city and 34 mpg highway. In 2002 an updated Elantra GT featuring leather seating and a sharply styled back was release. The Beta II engine with CVVT was also offered on subsequent versions of the Elantra sedan.Unlike the first generation, Grandeur's 2001 second generation model (also known as the XG300 and XG350) did not incorporate Mitsubishi technology. Rather it offered a choice of the Sigma 3.0 or 3.5L V6. These engines produced 182 and 200 hp respectively. The Sigma featured a cast iron block, aluminum DOHC cylinder heads, MFI fuel injection, 4 valves per cylinder, and forged steel connecting rods. It is interesting to note that this is perhaps the only time that Hyundai's internal project code (XG) was publicly used in the name of a vehicle. The United States XG350 received a facelift in 2003.Hyundai introduced a third generation XG300 / Grandeur in 2001 sans MitsubishiCATALYST FOR CHANGE, MONG-KOO CHUNGFather and son: Ju-Yung and Mong-Koo Chung in 2000The leader of the Hyundai-Kia Automotive Group was changed by founder, Ju-Yung Chung in 1999 after the Asian financial crisis and government mandated breakup of the Hyundai Group. Previously the automotive group was being managed by the founder's brother. His son, Mong-Koo Chung had performed well managing Hyundai's after-sale service and dealerships. Mong-Koo was the catalyst of an extreme turnaround for the company. During the 80s and 90s, his uncle focused on Hyundai Automotive's growth and producing as many cars as possible. Product quality and customer satisfaction suffered. From his experience working with dealerships and angry Hyundai customers, Mong-Koo knew well the damage to the Hyundai reputation and the high cost of warranty repairs.When Mong-Koo began broadcasting his intention to turn Hyundai into a top-five automaker, few outside the company took him seriously. Hyundai, like many family-controlled Korean companies, was ultra-hierarchical and slow to change. Managers rarely cooperated with one another and division chiefs ran their operations as personal fiefdoms. " When a problem occurred, each division would blame other divisions,"says Lee Hyun Soon, Korean head of R&D.Hyundai Chairman, Mong-Koo ChungMong-Koo's first step was to replace members of top management with engineers. He formulated a strategy to challenge Toyota for quality. Extensive work with consultants, J.D. Powers, and benchmarking of the world's best automotive companies followed. He also sent teams to America to study weather, road conditions, and driver habits. Quality control staff increased tenfold to 1,000 and they reported directly to him. Employees were encouraged and rewarded to offer suggestions. One example that is told is that a worker reported the Sonata and XG350 sedans had differently shaped spare tire covers. Sharing the cover saved Hyundai about $100,000 per year.There are reports that the Korean government requested that Mong-Koo step down as Hyundai Automotive's chairman in 2000 so that it could be led by a non-family member. Mong-Koo refused, arguing that he was best qualified to lead the company.Mong-Koo Chung has earned a reputation for an obsession with quality. The new Sonata's launch in Korea was delayed for two months for 50 items management wanted fixed. Employees in the Asan factory worked feverishly to correct items such as a tiny error in the size of the gap between two pieces of sheet metal near the headlight. The problem was not visible to the human eye and was narrower than 0.1 millimeter. Numerous managers and employees worked on the problem for 25 days before it was solved.The Sonata based Santa Fe crossover entered the market in 2001Hyundai entered the crossover, sport utility market in 2001 with the Santa Fe (project code SM). In addition to being a big hit for the company, it was a turning point and major milestone of the company's restructuring. Initially the Santa Fe was offered with a choice of two engines: a fuel efficient but underpowered Sirius 2.4L (138 hp) or the Delta 2.7L V6 (about 170 hp). Note: the initial introduction of the 2.7L Delta contained a flaw which Hyundai corrected for owners and solved in future versions of the Delta engine. Outside of the US, a 2.0L common rail turbo diesel (CRTD) was available. Reflecting Hyundai's new leadership, Hyundai listened to suggestions from customers around the world and released a rare 2002 1/2 model refresh incorporating a larger fuel tank and other changes. Responding to additional customer requests more modifications were made in the 2003 model including gas strut hood lifts, sunroof, illuminated glovebox, and the Sigma 3.5L V6 engine with 200 hp. Hyundai continued to make customer requested improvements with each subsequent model year.Hyundai introduced a new subcompact, city car in 2002, the Getz. Available in a choice of 1.1, 1.3, or 1.6L engines and a 1.5L common rail turbo diesel. Reviews frequently mention the manual transmission has the best feeling shifter yet. Fuel economy for the various conventional engines is in the high 40s with over 60mpg for the diesel.2002 Sonata makeover included more European styling cues than ever beforeSonata-based Tiburon is favorably compared to a famous Ferrari design 2003 Hyundai Terracan includes serious offroad ability and luxury features like Xenon healightsIn keeping with Hyundai's renewed focus on customer satisfaction, the Sonata likewise received a dramatic facelift in 2001 (2002 in the U.S.). The exterior took on a much more European look reminiscent of the third generation but with hints of Mercedes and Jaguar. The interior was restyled and the seats replaced with the more substantial seats used in the XG. The drivetrain was updated and improved to include the Delta 2.7L V6 and Shiftronic manually shiftable automatic transmission. The redesign was well received with sales increasing to higher record levels with each passing year. However, Hyundai did settle a class-action lawsuit over published horsepower numbers on the Sonata, Santa Fe, and to a lesser degree Elantra. Prior to the lawsuit, Hyundai voluntarily offered owners a choice of several compensations including an extra year of full warranty.A brand new second generation Tiburon appeared in 2003 (project code GK). Almost all of the press was favorable and praised the style and handling of the car. Numerous automotive writers compared the new car's lines to the famous Ferrari 456GT. Though acceptable, power for this sports coupe was not Ferrari like and featured the Delta 2.7L V6 with about 172 hp.Introduced in 2002, the Hyundai Terracan offers a CRTD or Sigma 3.5L V6 engine. This serious SUV sports a Borg Warner, shift on the fly transfer that can engage 4WD at up to 100km/hour, and a limited slip differential at the rear wheels. The name Terracan is a fusion of terra: Latin for earth or terrain and khan: Turkish or central Asian for ruler or king, as in Genghis Khan.Plans are underway to bring an SUV larger than the forthcoming Santa Fe to the U.S. It would be unwise to think that Hyundai engineers do not know how to build a serious body-on-chassis off-roader. In addition to the Terracan, they have had many years of experience building their own versions of the Mitsubishi Pajeros as the Hyundai Galloper for the South Korean market.A MODERN RENAISSANCEHMMA is the most automated automotive plant in the worldIn 2002 Hyundai initiated its plan to open a manufacturing plant in the United States. Eventually 1,744 acres of pasture in Montgomery, Alabama was selected for the future plant. The grand opening of the $1.1 billion plant occurred on May 20, 2005 and was attended by thousands including Alabama governor Bob Riley, former President George Bush, and Chairman Mong-Koo Chung. While the plant employs over 2,000 workers, more than 72 suppliers have located throughout North America to support the new plant creating more than 5,000 additional jobs. The 2-million square-foot manufacturing plant includes a stamping facility, paint shop, vehicle assembly shop, two-mile test track, and an engine shop. In May 2005, the facility marked the official start of production with its first saleable 2006 Sonata. Hyundai Motor Manufacturing Alabama (HMMA) will produce 300,000 vehicles per year at full capacity including the Sonata and Santa Fe. Using robotics, assembly methods, and a team structure tested in Asan, the plant is acknowledged as the most automated in the world.The first three stages of production: stamping parts from raw metal, welding them into a frame, and painting the chassis are all done with over 300 robots that move materials from beginning to end without being touched by human hands. The most labor intensive part of the process is the general assembly stage, where more than half the line workers are employed to add components. Once a frame is received from the first three stages, a car can be assembled in six and a half hours. Note: a Honda plant with similar production capacity in North America requires nearly twice as many workers. Many cars receive a complete inspection that includes a 2.3 mile road test, a brake and alignment check, and a five-minute shower in a water test booth to check for leaks and paint blemishes.This photo captures guests arriving for the grand opening flying over HMMA prior to the grand opening ceremony. After robots complete the first three stages of assembly, a Sonata is completed in 6.5 hoursSales reached 419,000 in the U.S. in 2004, up an astounding 360% since 1998. With the exception of a temporary slowdown in sales in the home Korean market, Hyundai sales are booming around the globe. Sales increased 21% in Europe for 2004 and Hyundai held a 17% share of the automotive market in India making it the largest foreign car company. Perhaps more surprising: in China's hotly contested emerging car market, Hyundai's joint venture with Beijing Automotive increased sales 62% for 2005 representing 233,688 cars. Growth came mostly from the Elantra model, the mainstay of Beijing's taxi fleet and the mainland's second best selling sedan after China's own Xiali. The company aims to boost production and sales by about 30 percent in 2006 to 300,000 units. Targets call for China production capacity of 600,000 units by 2008. Hyundai is the number one brand in the growing Russian economy. Sales there increased 72.5 percent in 2005 representing 87,457 automobiles. With a compounded annual revenue growth of 20% over the past five years, Hyundai has been the world's fastest-growing major automaker since 1999, according to Lehman Bros. Even Toyota vice chairman Fujio acknowledged the company that is growing in Toyota's rearview mirror. " Hyundai has quality and prices that have caught customers' attention, not to mention ours,"he said at an auto conference in August 2005.DaimlerChrysler sold the 10.5% stake it held in the Hyundai Motor Company in May 2004, ending the four year partnership. In a joint statement, the two automakers agreed to realign the alliance in order to reflect more realistically current market conditions." Under the agreement, Hyundai Motors also assumed DaimlerChryslers 50-percent stake in Daimler Hyundai Truck Corp., a joint truck engine factory in South Korea. The two also scrapped an earlier agreement for jointly making trucks. The deal started unraveling in September 2003 when DaimlerChrysler announced an alliance with Beijing Automotive to produce Mercedes-Benz sedans in the fast-growing Chinese market. Hyundai already had formed an exclusive partnership with Beijing Automotive a year earlier to manufacture sedans in China.The 2004 Sonata is named the most reliable automobile with only two problems per 100Mong-Koo's zero defect mantra is succeeding and Consumer Reports rated the 2004 Sonata the most reliable car in America for 2004 with only 2 problems per 100 vehicles. Likewise, Hyundai rose to second place in J.D. Power and Associates' 2004 survey of initial car quality, tied with Honda and trailing only Toyota. In 1998, Hyundai ranked among the worst in terms of initial defects. The comeback " is astounding,"says Chance Parker, executive director at J.D. Power in Westlake Village, California. " We really haven't documented that level of turnaround in that period of time. They've adopted a quality mentality they didn't have before." Former Hyundai Motor America CEO Robert Cosmai confirms: " The change really started with Hyundai Motor Company Chairman Mong Koo Chung. Quality is his mantra. The Chairman is very happy and pleased with these outstanding results, but he points out that this is just the first step and that we are just getting started." Hyundai's R&D budget has expanded 110% since 1999, to $1.6 billion for 2005. The South Korean R&D headquarters has expanded considerably and now features a three dimensional cinema for viewing virtual models of new cars. In each year since 2002, Hyundai has filed a record number of patents for new technologies.Joel Piaskowski, Chief Designer and head of the California Design CenterHyundai invested $200 million to open or expand research-and-design centers in California, Michigan, and near Frankfurt, Germany. In January 2003 Hyundai and Kia's California design teams moved from Fountain Valley to the new 90,000 square foot facility in Irvine. The center employs about 100 designers, engineers, and model makers with the task of designing vehicles for American tastes. Chief Designer Joel Piaskowski was brought over to head the design center from Detroit. The center houses advanced technology a visualization system from Blue Water Technologies. The designers and math modelers utilize the latest Alias/Silicon graphic workstations while clay modelers sculpt new design and proposals on five-axis milling machines. In January 2005, Hyundai opened a 4,300 acre $60 million proving ground in California's Mojave Desert. It includes a 6.4 mile oval track, 2 million square foot vehicle dynamics area, a 2.75 mile winding track, a 3.3 mile section of hills and special road surfaces, and 30,000 square feet of office space for about 50 staff. The track will be used for testing both Hyundai and Kia automobiles.2005 Hyundai Tucson offering standard electronic stability control, a first for a small SUV The U.S. 2006 Sonata LXHyundai expanded the lineup in 2005 to include a small, Elantra-based crossover SUV, the Tucson (project code JM). Even the basic GL models include a long list of standard safety features including head curtain airbags and electronic stability control. Engine choices include the Beta II 2.0L inline 4 with CVVT (140 hp), Delta 2.7L V6 (173 hp), or in some markets, a 2.0L common rail turbo diesel. AWD can be added for about $1,500 extra and features a " torque on demand"system which runs in 2WD mode until it detects a lack of traction.A fifth generation Sonata (NF project code) was launched in 2005 as a 2006 model incorporating competitive and industry leading features. Like the first generation model, it was designed with the North American audience in mind and includes design influence from Michigan and California. The Sonata is Hyundai's first release reflecting a new focus on safety. Reports indicate the company crashed 120 early Sonatas to perfect the structure and best engineer it to absorb and channel impact energy around the passenger cabin. It has earned five star safety ratings for both front and side impacts. Even base models include more standard safety features than any other car in a similar class including head curtain airbags, electronic stability control, traction control, antilock brakes, brake force distribution, and active headrests. Several engine choices are offered including new aluminum Theta 2.0 and 2.4L engines with CVVT (162 hp) and a new aluminum Lambda 3.3L V6 with CVVT (235 hp). Some reports indicate a hybrid Sonata may be sold in 2007.Fourth generation 2006 Azera/GrandeurThe third generation 2006 Accent sedan is more refined and larger than previous generationsA fourth generation Grandeur (project code TG) was also launched in 2005. In North America it is known as the Azera. Built on a larger Sonata platform, the Grandeur/Azera includes a larger 3.8L version of the Lambda engine (263 hp). It has more interior room than the BMW 760i, Mercedes S Class, and Toyota Avalon. The front-wheel-drive Azera rides on front double wishbones and a rear multilink suspension, with 16 or 17"wheels. At 192.7 inches long, 72.6 inches wide, and 58.7 inches tall, the Azera is 0.8 inches longer and wider and 2.8 inches taller than the outgoing Grandeur. Safety features are similar to Sonata with the addition of side airbags for rear seat passengers. Luxury features include rain sensing wipers, power rear sunshade, rear air vents, dual climate control, electroluminescent dash and power adjustable pedals and seats.Hyundai introduced the third generation Accent at the 2005 New York International Auto Show (project code MC). The sedan reached dealerships in December 2005 as a 2006 model. Passenger space has increased considerably over previous models. It is one inch wider, 1.8 inches longer, and three inches taller than the previous generation. Only the GLS trim level will be offered in America including six airbags, choice of a five speed manual or four speed automatic, and an updated Alpha II 1.6L inline four cylinder engine with CVVT (110 hp). Fuel economy is rated at 35/36 mpg on the highway. A sporty coupe concept has been shown and is expected in 2006 or 2007. Likewise Hyundai has shown hybrid versions of this new Accent indicating it could reach the Korean market in 2006. It was fitted with a Beta II, 1.4L CVVT engine (90 hp) plus a 16 hp electric motor which Hyundai indicates boosts fuel economy by 44%.IN MEMORIAM, JU-YUNG CHUNGIt is worth noting that Hyundai founder, Ju-yung Chung was one of the civilian forces at the head of the effort to rebuild the war torn cities of Vietnam in 1977. He was made an honorary Commander of the British Empire by England's Queen Elizabeth II. In 1982 he was the first non-American entrepreneur and philanthropist to receive an honorary degree in business from George Washington University. He received many other honorary degrees including a doctorate from John Hopkins University. Additionally he channeled a large amount of Hyundai profits into philanthropic and civic causes throughout North and South Korea building hospitals, schools, and apartment complexes for Hyundai workers. Ju-Yung Chung (1915 - 2001) is a Korean national hero. To my way of thinking, there may be miracles in religion but not in politics or economics... We succeeded because our people devoted their enterprising spirits. They used the force of their minds. Conviction creates indomitable efforts. This is the key to miracles... Man's potential is limitless. Ju-Yung ChungIn March of 2001, Ju-Yung Chung was admitted to Seoul's Asan Medical Center. His critical case of pneumonia worsened and he died on March 21st, 2001 in one of the hospitals constructed by his charity. Ju-Yung Chung was mourned as a national hero in Korea and was credited with rebuilding a war torn and impoverished nation. Hyundai officials revealed that in keeping with his wishes that " he had come empty handed and he would leave empty handed,"he gave more than $57 million to the business he founded in 1946
   Manufacturing Process
   right0StampingIn the Stamping Shop, the vehicle begins to take shape. Housed in the shop are large rolls of steel, each weighing between 20,000 and 40,000 pounds. Cranes are used to lift the rolls and put them into the blanking machine, where rectangular pieces, thin as a dime, are cut and stored in racks. The pieces are automatically moved to one of two large, stamping presses with dies molded into various shapes. Over 5,400 tons of pressure transforms the steel blank into a specific body part.
   WeldingThe Welding Shop containing 280 robots capable of maneuvering and welding body parts. These amazing automated machines position stamped body parts and accurately weld them together to form the vehicle body, called a body-in-white. Both the Sonata and Santa Fe vehicle bodies move down the same assembly line at HMMA. Team Members attach hinges, doors, hood and trunk, then check the quality of each car body to confirm the welding process is perfect.
   PaintThe completed body-in-white moves from the Welding Shop, along a trestle into the Paint Shop for the nine-hour painting process. The vehicle first rotates 360 degrees in a unique electrocoat bath to prepare the entire body for paint. Eighty-one robots apply primer, a base coat using one of 15 different water-based paint colors, and a final clear coat which provides a beautiful shine and long-lasting protection. Since the Paint Shop is an environmentally-controlled area, Team Members must wear special overalls and gloves to protect themselves and the paints finish. A single particle of dust can affect the overall quality of a vehicles paint finish. The Paint Shop has over four miles of conveyor systems to move the vehicle bodies through each different process. After drying, the freshly-painted vehicle body heads to General Assembly.
   General AssemblyGeneral Assembly houses approximately 1,150 Team Members who install a variety of parts to complete the vehicle. The painted vehicle body moves through the trim area where wires, brake controls, and other parts are quickly connected inside the vehicle, under the hood, and in the trunk. The doors are taken off early in the process and sent to another area where speakers, power windows, door seals and other parts are installed. In the chassis area, the underside of the vehicle is completed and the engine and drive train are connected to the body. After the tires, battery, front and rear glass, and seats are installed, the doors are reattached to the vehicle. Oil, engine coolant, gasoline and other vital fluids are added, and then the vehicle is started for the first time. A roll booth tests the braking system and then the vehicle is driven on a two-mile test track to check for rattles or other issues. A shower test checks for leaks and once a vehicle meets all quality standards it is ready to be shipped to a dealer in North America.
   EngineHMMA takes pride in having its own Engine Shop. The Hyundai V-6, 3.3l engine, producing 235 horsepower is made here on site in Montgomery. Castings of engine blocks, heads and crankshafts are delivered from suppliers and machined to HMMAs exact specifications. Over 150 computer-controlled machines perform precision cuts to these engine parts. A sophisticated test laboratory performs precision computer measurements to ensure the machining process cuts and drills the metal to proper specifications. After machining and precision measurement testing, the parts are moved along a conveyor system to engine assembly where Team Members follow detailed procedures to assemble pieces of the engine. All engines are first cold-tested for leaks, then hot-tested, by starting the engine to ensure it meets manufacturing specifications. A Hyundai transmission is then married to the new engine to complete the assembly process. After a final quality check, the engine is sent on a trestle to the chassis section of General Assembly where it is attached to the drive train and the rest of the vehicle.
   QualityQuality checks are built into each step in the production process. Each vehicle has to pass a series of stringent tests, including satisfactory performance on a two-mile test track.
   Production ControlIn the production control department, HMMA manages whole supply chain activities and the network, begi