The Hyundai Motor Company (HMC) is a South Korean manufacturer of automobiles. In 2003 it was South Korea's largest car maker and the world's seventh largest car maker. HMC operates the world's largest integrated automobile manufacturing facility in Ulsan on South Korea's southeast coast.
Chung Ju-yung founded the Hyundai Motor Company in 1947 as Hyundai Engineering and Construction Co. Hyundai Motor Co. (HMC) was established in 1967. The company's first model (Cotina) was released, in cooperation with Ford Motor Company, in 1968. In 1975, the Pony, Korea's first proprietary model, was released, based on Japanese Mitsubishi technology. The Pony was exported for the first time in 1976. In 1986 Hyundai began to sell in the U.S., and the Excel, as the Pony was known there, was nominated 'best product 10' by Fortune magazine, largely because of its low price. The company began to produce models manufactured with its own technology in 1988, beginning with the mid-size Sonata.
Hyundai cars are often perceived as low-end, unreliable, and undrivable due to its malfunctions. Recently, Hyundai has begun to overhaul its image in an attempt to establish itself as a reliable brand. The efforts seem to be a success as of late, as Hyundai's sales continue to climb year after year. Hyundai now is the fastest-growing auto brand in the United States. Essentially, Hyundai's parent company, Hyundai Motor Group, began investing heavily in the quality, design, manufacturing, and long-term research of its vehicles starting in 1998, and added a 10 year or 100,000 mile warranty to its vehicles in the United States. This effort has paid dividends for Hyundai, as over time their quality has become the polar opposite of those original cars to enter the United States. In 2004, Hyundai tied with Honda for initial brand quality in a survey/study from J.D. Power and Associates, for having 102 problems per 100 vehicles. This rating, for the Hyundai and Honda brands, is second in the industry behind Toyota when looking at grouped branding (Toyota would be ranked as Toyota, Lexus, and Scion together; Honda would be ranked as Honda and Acura together), but when looked at without grouped branding, Honda and Hyundai both tie for making the highest quality automobiles in the American market.
Despite the fact that Hyundai now makes reliable vehicles considered to be of good quality, like the Sonata which has gone from being a questionable machine at best to being named "Most Reliable Car" in 2005 by Consumer Reports magazine, many still hold to the notion that Hyundais are low quality, "cheap" cars. It would seem, however, that statistics and consumers would suggest otherwise.
In 1998, after a shake-up in the Korean auto industry caused by overambitious expansion and the previous year's financial crisis, Hyundai acquired Kia Motors. In 2000, the company established a strategic alliance with DaimlerChrysler and severed its partnership with Hyundai Group. In 2001, Daimler-Hyundai Truck Corporation was formed. In August 2004, DaimlerChrysler sold its 10.5 percent stake in Hyundai for $900 million U.S. dollars.
The Hyundai Group, founded by Chung Ju-yung in 1947 as a construction company, was once South Korea's biggest conglomerate (chaebol). The company was split into five separate, independent business entities in 2001.
Hyundai Motor Group originally manufactured cars for other brands including Ford, and Mitsubishi, along with their own cars to be sold in their domestic market. These original cars were essentially re-badged Fords and Mitsubishis manufactured by the South Korean company.
Hyundai entered the United States market in 1986 with different Excel models. This same year, Hyundai set a record for selling the most automobiles in its first year of business in the United States compared to any other car brand, a staggering 126,000 vehicles.
Initially well conceived, the Excel provided Hyundai with a bad image, as over time it's faults became apparent. The old Mitsubishi design was just that, old. Also, in efforts to bring the costs down, quality and reliability suffered.
Over time, Hyundai began introducing its own models. The Sonata midsize sedan was Hyundai's first in-house design, though it still featured many Mitsubishi designs and parts, which made its quality suffer tremendously.
As time caught up with the poor reputation of Hyundai in the United States, sales dropped more and more, and dealerships were abandoning franchises. Rather than drop out of the world's largest automotive market, the parent company of Hyundai in 1998 began investing heavily in the quality, design, manufacturing, and long-term research of its vehicles, and added a 10 year or 100,000 mile warranty to its vehicles in the United States. This effort has paid dividends for Hyundai, as over time their quality has become the polar opposite of those original cars to enter the United States. In 2004, Hyundai tied with Honda for initial brand quality in a survey/study from J.D. Power and Associates, for having 102 problems per 100 vehicles. This rating, for the Hyundai and Honda brands, is second in the industry behind Toyota when looking at grouped branding (Toyota would be ranked as Toyota, Lexus, and Scion together; Honda would be ranked as Honda and Acura together), but when looked at without grouped branding, Honda and Hyundai both tie for making the highest quality automobiles in the American market.
Investing has proved to be a good strategy for Hyundai in the United States, as its sales grow faster than any other car brand year over year, with no hint of this changing any time soon.
Despite the fact that Hyundai now makes extremely reliable and high-quality vehicles, like the Sonata which has gone from being a questionable machine at best to being named "Most Reliable Car" in 2005 by Consumer Reports magazine, many still hold to the notion that Hyundais are low quality, "cheap" cars. It would seem, however, that statistics and most consumers would say suggest otherwise.
In 2004, Hyundai Motor America constructed an automobile manufacturing plant in Montgomery, Alabama where its new NF Sonata, and Santa Fe SUV models will be manufactured for the North American market. This is Hyundai's first American plant, and one of the most technologically-advanced plants in the entire world.
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