Global Strategy
Hyundai Motor Company
Question 1: HMC’s problems and strategy
Introduction:
During 1980s and 1990s, Hyundai group had been affected by several factors whether internally or externally which had a huge influence on its market position and brand image, in particular its U.S subsidiary, Hyundai Motor America (HMA).
This report will focus on these factors particularly in US and the strategies that help Hyundai to overcome these problems with my point of view regarding whether these strategies were successful or not.
HMA’s difficulties during the 1980s and 1990s:
Hyundai’s challenge came in particular from a sequence of situations facing the company.
Market position and Brand reputation
One of the fatal problem that affected (HMA)’s market position and brand reputation was in 1986, when Hyundai exported its first car model (EXCEL) to US market. HMA sold 100.000 Excel cars within seven months. The timing in terms of US market segmentation was ideal at that time since most of automakers were produce high priced cars and the customers such as college students and young couples wanted a car with a low price. But unfortunately, customers started to realize the severe quality problems in this car for example, the car bodies rusted fast, air conditioners did not work on hot days and it could stop any time on the street with its engine blown.
Because of this, The Excel became among the bottom 10 car models and were also rated the worst cars overall for injury claims based on the analyses of insurance coverage and claims data by the Highway Loss Data Institute.
Which cause the sales of Hyundai in 1989 to fell to 30% which in turn affected its market position and reputation in US.
Hyundai was been labeled at that time by low quality-low price cars. The maximum and minimum prices of Hyundai cars were almost the lowest in the auto industry. Hyundai was one of few automakers that did not offer cars priced over $30,000 in the U.S. Many people suspect
Question 1: HMC’s problems and strategy
Introduction:
During 1980s and 1990s, Hyundai group had been affected by several factors whether internally or externally which had a huge influence on its market position and brand image, in particular its U.S subsidiary, Hyundai Motor America (HMA).
This report will focus on these factors particularly in US and the strategies that help Hyundai to overcome these problems with my point of view regarding whether these strategies were successful or not.
HMA’s difficulties during the 1980s and 1990s:
Hyundai’s challenge came in particular from a sequence of situations facing the company.
Market position and Brand reputation
One of the fatal problem that affected (HMA)’s market position and brand reputation was in 1986, when Hyundai exported its first car model (EXCEL) to US market. HMA sold 100.000 Excel cars within seven months. The timing in terms of US market segmentation was ideal at that time since most of automakers were produce high priced cars and the customers such as college students and young couples wanted a car with a low price. But unfortunately, customers started to realize the severe quality problems in this car for example, the car bodies rusted fast, air conditioners did not work on hot days and it could stop any time on the street with its engine blown.
Because of this, The Excel became among the bottom 10 car models and were also rated the worst cars overall for injury claims based on the analyses of insurance coverage and claims data by the Highway Loss Data Institute.
Which cause the sales of Hyundai in 1989 to fell to 30% which in turn affected its market position and reputation in US.
Hyundai was been labeled at that time by low quality-low price cars. The maximum and minimum prices of Hyundai cars were almost the lowest in the auto industry. Hyundai was one of few automakers that did not offer cars priced over $30,000 in the U.S. Many people suspect
References: 5. Globalization strategies of Korean Motor Vehicle industry [online] Available from: http://www.staffs.ac.uk/schools/business/resits/postgrad/CorporateandGlobalresitcase-Hyundaiglobalstrategies.pdf, (accessed on 28 November 2012). 6. HYUNDAI MOTOR COMPANY’s case study, (accessed on 22 November 2012). 7. Metcalfe, J. (1995), Policy Issues for Business, London UK, 2002. 8. S. Ghoshal, strategic Management Journal, UK, 1987. Total Number of Words: 496 (excluding references)