Strategic Audit of Hyundai Motor Company
Hyundai Motor Company
Hyundai Kia Automotive Group is a parent company of Hyundai Motor Company (HMC). In Korean, Hyundai means modernity. Hyundai is the largest car maker in South Korea after took control of Kia and ranked world fifth largest automaker in terms of sales. Hyundai’s vision is to provide value to the future of customers. In addition, their mission is to provide excellent automotive value for customers by the combination of safety, quality, efficiency, stability and security. On the other hand, Hyundai is concerned about environmental problems which are increasing nowadays (Hyundai Motor Company, 2008)
International strategic management process within the global environment contains various elements however there are five parts which considered as most important elements while international business is performing , which are home country, supplier country, customer country, partner country and competitor country. Through Star Analysis, there are few essential useful strategic recommendations. It overcomes its demand and supply limitations by utilising the strength of company’s home country through international transactions. In addition, it appoints appropriate supplier countries that matched with the firm’s strategy. In order to maximise net profits from trading, targeting at the right customer countries is important. Besides, complementary of demand-side and supply-side are provided by the right partners. Lastly, it hopes that competitors are well-performed in their home, supplier, customer, and partner country locations (LEE, 2005).
SWOT Analysis is an effective method of identifying internal Strengths and Weaknesses and for examining the external Opportunities and Threats facing Hyundai. SWOT of Hyundai
Brand name recognition
High quality of cars
Diversity of products, services and management style
Exposure of weakening world economy
Low cost labor in Asian markets
Difficult for new competitors to enter the market
Low bargaining power of suppliers
No real substitute for cars
Baby boomers, the potential profitable segments
Continuous technological innovations
Suppliers integrating vertically to provide manufacturers with all the auto parts, thus increasing their power Increased competition among existing firms
Change in consumer demands
Hyundai has acquired a brand name that is known and sold worldwide. They have also established a reputation for producing high quality cars. Diversity has enabled Daimler and Hyundai to share information with one another that can strengthen their business. With innovative products they have become one of the most successful and respected companies in the world. Hyundai is the world's third largest car manufacturer, a global company with strong brand portfolio available to different customer segments. The company's products range from executive sedans to heavy trucks to finance services providing cover from individual market risk.
Accord, one of the group's strongest brands, enjoys a high level of customer loyalty. The Accord and Smart brands performed well during a difficult economy in 2008, operating profits increased by 38% (Hitt et al, 2009). Size is a major strength because it enables them to buy in bulk, thus reducing costs and achieving competitive advantage and is able to exercise control over suppliers.
The language barrier between the Germans and Americans can cause the company to have problems communicating on how the business should be maintained. Hyundai group performance has been disappointing over the last few years. Hyundai face strong competition in all its business segments. Globally, General Motors and Ford provide the biggest challenge to the...
References: Hyundai Motor Company (2008) [online]
LEE, H. (2005) Strategic Alliances and Trade Dispute in Automobile Industry. From the Perspective of the Relationship between government and industries in Japan and Korea
Jeremy Weber (2008), Toyota and Honda start testing vehicle-to-vehicle communications systems [online].
Chosun Ilbo (2005), Hyundai to Partner with LS Group and LG Chem on Hybrids
Hitt, Michael et al (2009); Strategic management: competitiveness and globalization : concepts & cases; Cengage Learning, ISBN 0324655592, 9780324655599
Hoskisson, Robert; Hitt, Michael & Ireland, Duane (2008); Competing for Advantage; Cengage Learning, ISBN0324316666, 9780324316667
Linsu Kim (2009); Learning and innovation in economic development; Edward Elgar,
Prasad (2008); Strategic Management; PHI Learning Pvt. Ltd; ISBN812033809X, 9788120338098
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