For Hyundai, the layout of 1.25 million vehicles is not only the demand for its goal of achieving the world's fifth-largest automotive manufacturer, but also the more important reason is that the Korean automotive market has no room for growth.
As always, the streets of South Korea are busy. Even on the “Olympic 88†road designed at a speed of 100 kilometers per hour designed specifically for the Seoul Olympics, the car is stopped. This situation is not a road problem, but the number of cars that Seoul can no longer increase.
At present, the population of South Korea is 47 million. With the exception of other types of vehicles, there are 12 million cars in the country, which means that every four people have a car. However, the situation in Seoul is even more serious: 13 million people and 5 million cars. Every 2.5 people a car. What was most impressive in the days of South Korea was its expensive consumption. The only thing that was cheap in this country was a car.
According to statistics from Korea Automotive Industry Association, South Korea’s auto production climbed to 3.15 million vehicles in 2002, reaching the highest level in history. This agency expects South Korea’s auto production in 2005 will reach 3.78 million, and the export volume will exceed the 2 million mark for the first time. It reached 2.07 million vehicles.
Remodeling Yueda Kia
Among the automotive companies in South Korea, Hyundai-Kia Group has a 75% share.
As early as 1992, before the establishment of diplomatic relations between China and South Korea, Daewoo, South Korea’s second-largest auto giant, began to set foot in the Chinese auto industry and used an office in Hong Kong’s “shell company†to set up an office in Beijing instead of Daewoo headquarters. Its business with China.
After the establishment of diplomatic relations between China and South Korea, the success of Shanghai Volkswagen has made foreign auto makers look red-eyed. Several auto manufacturers in South Korea are also pondering the idea of ​​how to open up the Chinese market. In 1998, after the loss of Guangzhou Peugeot in successive years, he searched for her husband's family. Can take this grand exhibition in the Chinese car market. However, contrary to what was expected, Guangzhou Honda finally re-married Honda in Honda, Opel and Hyundai’s “fight.â€
The industry generally believes that among several alternative companies, Guangzhou Peugeot has already secretly chosen Honda because the technology of South Korea's Hyundai mainly comes from Japan's Mitsubishi, and Japan's Honda is stronger than Japan's Mitsubishi, so choosing Honda is an expected thing.
After the Asian financial crisis, the bankruptcy of South Korea’s third-largest automobile company Kia Motors was acquired by Hyundai. After the Guangzhou Peugeot project was frustrated, Hyundai found Kia Yuen’s Jiangsu Yueda Kia Auto Co., Ltd. in China and established Jiangsu Yueda Modern. Kia Motors Limited. At the beginning of the company's establishment, Hyundai had publicly stated that it would invest large amounts of money to build it into a 300,000 large-scale plant.
However, the joint venture suffered losses year after year in 2000 and 2001, a loss of 58.74 million yuan in 2000 and a loss of 62.85 million yuan in 2001. This situation has forced it to embark on the road to reorganization, making it the first car after China’s entry into the WTO. Industry-related restructuring projects.
The following events explained that modern investment in China “finally found a wayâ€. Soon, the modern industry withdrew. In March 2002, Dongfeng Motor entered. Dongfeng, Yueda and Kia invested $98 million to reshape the joint venture. The capital is 70 million U.S. dollars, Kia has invested 35 million U.S. dollars, accounting for 50% of the shares, and Dongfeng and Yueda each account for 25% of the shares. The name of the joint venture company has changed to Dongfeng Yueda Kia.
Modern understands that according to China's auto industry policy, a foreign automobile company can only have a joint venture with two domestic auto companies. For modern times, Kia is relatively independent. If you invest separately, in addition to a joint venture with Jiangsu Yueda, Kia Motors can also choose another joint venture. Modern can also withdraw from the project and invest in other projects.
Fortunately, after the reorganization, Dongfeng Yueda Kia’s economical sedan quickly seized the domestic economy car market.
Therefore, Hyundai decided to establish a "Beijing Hyundai Motor Co., Ltd." joint venture with BAIC in September last year. Zhong Shi believes that: Daewoo Motor's project in China will make South Korea's Hyundai and Kia not repeat the same mistakes. The success of the Guangzhou Honda project and the launch of the Chang'an Ford project will enable the modern high-level executives to strengthen this view. Niu Erhu spreads out the spare parts industry group, occupies the joint venture share, but cannot replace the entire vehicle project. On the contrary, the auxiliary enterprises that enter the Chinese market together can successfully realize the entire vehicle production project.
After China's accession to the WTO, new changes will be made to the industrial policy. The difficulty in admitting access to the entire vehicle joint venture project will change, and at the same time it will affect the rigid requirements for the domestic production of parts and components. This series of variables significantly reduces the cost of entering the market for the latecomers' modern cars. The first-timers will take the lead in brand expansion, market share, sales network, and service network, while the later modern companies will invest in the risk and localization burden. Take advantage of it.
1.25 million Chinese production layout
As of August this year, Beijing Hyundai's Sonata has sold 30,000 cars and its sales target in 2003 was 50,000. When the former chairman of the modern company, Zheng Mengjiu, visited China on July 7th, he said that Hyundai plans to expand Beijing Hyundai to an annual production capacity of 200,000 units in 2006 and expand it to an annual output of 550,000 units by 2010. Become the largest overseas production base of Hyundai Motor Group. Prior to this, Zheng Dayu, general manager of Dongfeng Yueda Kia, once told the newspaper: In 2010, Dongfeng Yueda Kia’s output will also reach the scale of 500,000 vehicles. The two sedan projects completed the modernization of more than 1 million cars in the Chinese market. The goal.
Apart from cars, Hyundai’s layout in China still includes Shandong Huatai Automobile and Anhui Jianghuai. Although Huatai has repeatedly claimed that its cooperation with Hyundai is a purely technical aspect, this statement does not cover up Hyundai’s use of Huatai to build its largest SUV production in China. The ambitions of the base, Huatai Automobile sources revealed that by the end of this year, Huatai Motor plans to produce 15,000 "Traca" SUVs. By 2004, the annual production capacity will reach 30,000, and the production in 2010 will reach 200,000 units. . At the same time, Hyundai laid out pieces of medium-sized trucks in Jianghuai Automobile. The technical cooperation between Hyundai Heavy Trucks and Jianghuai Automobile has achieved results. Its designed production capacity is 5,000 vehicles per year.
Different car layouts show modern ambitions in the Chinese market: The total output of more than 1.25 million cars reshapes a “Chinese modernâ€. According to a person in Beijing Hyundai Sales Management, the total planned production of Hyundai to 2010 is 5 million, and after 7 years, China’s output is, for modern times, 25% of its total global production in 2010, accounting for Hyundai Motor’s 1/4 of the output.
In early 2003, Hyundai Group and Bank of China established a credit line of up to 500 million U.S. dollars, which will give Hyundai Motor Co. a loan quota of nearly 243 million U.S. dollars, a loan quota of 207 million U.S. dollars for Kia and 50 million U.S. dollars for modern MOBIS, and also for modern times. The foundation for the early development in China has been laid. Zhuang Jie, deputy general manager of Beijing Hyundai, said that Beijing’s Hyundai’s spare parts manufacturers will increase from the current 24 to 38. Most of these companies are solely funded by the modern iron supporting company MOBIS. In addition to supplying Beijing Hyundai, it will also supply Hyundai's other companies in China.
According to industry insiders, as in soccer in South Korea and Japan, both sides cannot tolerate losing to each other. This kind of competition also exists in the automobile industry.
For Hyundai, the layout of 1.25 million vehicles is not only the demand for its goal of achieving the world's fifth-largest automotive manufacturer, but also the more important reason is that the Korean automotive market has no room for growth.