Hyundai Gains Ground in U.S.

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<h3>Hyundai gains ground in U.S.</h3>

December 27, 2005 - Operations at Hyundai Motor Group's plant in Alabama, which has been running since May, are stabilizing after the plant initially failed to meet expectations.

Hyundai Motor Co., Korea's leading automobile manufacturer, said yesterday that the operating rate of the plant, which manufactures the company's passenger vehicle, the Sonata, is expected to exceed 80 percent.

As of November, Hyundai Motor had produced 72,983 units. At its current pace, the company expects to manufacture over 90,000 vehicles this year, under its initial yearly goal of 120,000 units. The company's Alabama plant is equipped with high-tech facilities and is capable of producing more than 70 cars an hour.

"We had difficulty before the production lines normalized, with unexpected problems such as cultural difference and the illiteracy of the workers," a Hyundai Motor official said. "Yet, we are relatively good compared to Japanese companies, who take between six to ten months to normalize operations at plants set up in the United States."

The company said the sales of Sonatas manufactured at its Alabama plant faced many difficulties at first due to the aggressive marketing of Japanese competitors ¡ª Toyota and Honda ¡ª and the discount sales of American car makers General Motors and Ford.
In particular, Honda had a major impact on the Korean car company's sales, releasing in September its new Accord, which is aimed at the same consumer demographic.

To compete with the fierce competition in the U.S. market, Hyundai Motor's local dealers have been providing a rebate of between $1,000 and $2,000 on sales of new Sonatas since October.

But in the bigger picture, Hyundai Motor this year saw its sales in the U.S. market hit a new high for the company. As of November, the Korean car company sold more than 412,000 vehicles, including the sales of vehicles that were imported from Seoul.

Hyundai is expecting to sell 450,000 cars in the U.S. market this year, about a 7-percent increase from last year. This would put the Korean company in seventh place in the U.S. market in sales, trailing the U.S. automakers General Motor, Ford and Chrysler, and the Japanese car makers Toyota, Honda and Nissan.

Hyundai Motor is hoping to produce 150,000 Sonatas and 100,000 units of its sport-utility vehicle, the Santa Fe, next year.


by Kim Tae-jin <ojlee82@joongang.co.kr>



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