Comments on: Hyundai Myth Exploded… Maybe

By: jthorner

jthorner — Wed, 19 Dec 2007 07:32:31 +0000

Hyundai is reported to make many more components in house, so that could indeed be part of why their headcount seems high.

It has always aggravated me that financial types think revenue per employee is a key metric. Outsourcing work isn’t always cheaper and in fact it is quite possible to improve the revenue per employee metric while reducing profitability, quality, delivery and more.

But since outsourcing is all the fad, Detroit should outsource it’s strategic planning to a group of well paid TTAC contributors :). They could lay off a bunch of expensive managers and get better results!

By: Nemphre

Nemphre — Wed, 19 Dec 2007 05:39:22 +0000

the swoopy Toyota “T”

That’s supposed to be a T? I thought it was some kind of representation of a globe. When I was younger I thought it was supposed to be a bull; it’s easy to see a head with horns.

By: Macca

Macca — Wed, 19 Dec 2007 03:47:26 +0000

Jthorner, I’m not feeling the logo comparison. I mean, both companies start with an “H”. Also, it appears that the Hyundai logo is not just an italicized “H” – it has a swoopy, asymmetrical quality to it, which incidentally, sort of cheapens the logo, in my opinion. Further, the Honda “H” is surrounded with a box, whereas the Hyundai “H” gets an oval.

It would appear that they tried to create a very un-Honda “H”, but that’s purely my interpretation.

That said, the Hyundai logo is only slightly less ugly than the swoopy Toyota “T” and Chevy bow-tie.

By: slateslate

slateslate — Tue, 18 Dec 2007 21:50:22 +0000

When it comes to labor intransigence Korean unions make the UAW look like angels.

By: quasimondo

quasimondo — Tue, 18 Dec 2007 19:49:08 +0000

Somebody is going to have to explain this to me like I’m a three-year-old. What exactly are these numbers supposed to tell me, and what does that mean for Hyundai? Not a criticism, but I just see numbers and it’s leaving me a bit slack-jawed here.

By: willbodine

willbodine — Tue, 18 Dec 2007 18:05:10 +0000

Yeah, that doesn’t jibe with what I know about high levels of productivity in other S. Korean industries. The big question I have for Hyundai is what are they going to do to differentiate stablemate Kia from the Hyundai brand? Because right now, they are both pitching the same cars to the same buyers. Where are the economies of scale in that?? Should I buy the Pontiac or the Buick? The SEAT or the Skoda? The Toyota or the Scion? See what I mean…

By: JK43123

JK43123 — Tue, 18 Dec 2007 17:50:29 +0000

Given all of Toyota’s recalls of late, perhaps their staff NEED to spend Hyundai-type time with each car.

John

By: EJ_San_Fran

EJ_San_Fran — Tue, 18 Dec 2007 17:25:55 +0000

The number of workers per car is a misleading statistic.

If one company uses more outsourcing than the other, the number of workers per car is going to be lower, but it doesn’t mean anything.

By: jazbo123

jazbo123 — Tue, 18 Dec 2007 16:55:05 +0000

I know blogs are global and all that, but I’ll admit to a little schadenfreude whenever an Asian automaker has problems.

By: starlightmica (Richard Chen)

starlightmica (Richard Chen) — Tue, 18 Dec 2007 16:00:40 +0000

The Hyundai Big Duh Holiday Sales Event is prominent in our local weekend autos section.

0% for 72 months + $500 back on 2008 Sonatas – yipes. The local dealer here has them with V6/ leather/moonroof for $20k, $5k below MSRP.

By: jthorner

jthorner — Tue, 18 Dec 2007 15:11:10 +0000

Hyundai’s advertising in the US seems almost nonexistent. As crowded as this market is, it is hard to stand out and be noticed. Also I think that having a second brand in the US, Kia, is a big mistake. There are way too many me-too models on offer in the US these days. The buying public can only keep a few choices in each segment in the collective mind. Thus second tier brands like Hyundai, Kia, Mitsubishi, Mercury, Pontiac, Saturn, et. al. really struggle to find enough buyers. For mainstream cars and trucks everyone knows Toyota, Honda, Ford, Chevy, Chrysler/Dodge and maybe Nissan. After that the awareness drops like a rock.

Hyundai also has massive union problems in South Korea, which is probably part of the reason for their high costs and low productivity.

Hyundai also seems to have positioned themselves as a cheaper Honda, right down to the logo for Hyundai looking like a Honda logo italicized. The problem is, Honda only has to come reasonably close to Hyundai’s price to win. Do you want the cheap copy or the well known original? Have a look at the logos:

http://www.cartype.com/images/page/hyundai_emblem.jpg

http://www.cartype.com/images/thumbs/1/Honda_2.jpg

Finally, they have had plenty of management scandal at home which doesn’t help with the problem of keeping an eye on the ball.

Yep, in the US at least the Hyundai juggernaut is caught in neutral. They have a history with Mitsubishi and the smart thing would probably be to combine their respective auto making companies. Not going to happen though.

By: carguy

carguy — Tue, 18 Dec 2007 14:44:29 +0000

Like all corporations, Hyundai is not without its problems and challanges, however. However, I think they still have a bright future as they have not only demonstrated their ability to adapt to market forces with an impressive product improvement but also seem to have the ability to learn fom their mistakes (unlike some other automakers).

By: umterp85

umterp85 — Tue, 18 Dec 2007 14:18:50 +0000

A bigger problem for Hyundai is that their spanking new product line isn’t driving increased year-on-year sales or share gains

By: NN

NN — Tue, 18 Dec 2007 14:15:38 +0000

Everyone got too excited about Hyundai too quickly. Long term, they will be a formidable challenge. But I think their growing reliability reputation hasn’t really been earned yet…I’ve yet to meet a Hyundai that has lasted over 150k miles, let alone 200k and beyond.

By: blautens

blautens — Tue, 18 Dec 2007 13:54:49 +0000

But what if Hyundai automates less and decides to spend more on labor than machinery per vehicle made?

I don’t know if that would be wise, but it would certainly explain the above figures.

By: GS650G

GS650G — Tue, 18 Dec 2007 12:57:10 +0000

Still a better car with a better warranty overall.

By: Cammy Corrigan

Cammy Corrigan — Tue, 18 Dec 2007 12:34:26 +0000

I don’t see this as a huge problem for Hyundai. We all forget that Hyundai are still learning and they still have a way to go. Management will have to arrange more efficient ways of manufacture (maybe Kaizen?) and talk to the South Korean Unions for less strikes and more work (does this all sound familiar?).

Another problem with Hyundais is their resale value. In the UK (and I’m pretty sure the same will apply in North America), Hyundais are fantastic value brand new. Superb reliability, value for money and a great warranty. However, when it comes to selling it on, the second hand market is full of Japanese, European and American cars at bargain prices. So basic laws of economics, dictate that the Hyundais have to fall a LONG way in order to find a buyer.

It’s a shame, but that is a tragic flaw with cars of this nature.

By: shaker

shaker — Tue, 18 Dec 2007 11:53:11 +0000

I thought that the price of these cars was too quickly approaching the Japanese competition. I had accepted the “Exchange Rate” idea, but I’m happy to know that my hunch was right — something is rotten in…!