Hyundai Case Study Essay

8393 Words 34 Pages
Asia Pacific Business Review
Vol. 12, No. 2, 131–147, April 2006

Globalization and Employment
Relations in the Korean Auto Industry:
The Case of the Hyundai Motor
Company in Korea, Canada and India
RUSSELL D. LANSBURY*, SEUNG-HO KWON** & CHUNGSOK SUH†
*University of Sydney, **School of International Business, University of New South Wales,

University of New South Wales
ABSTRACT Examination is made of the complex interactions between globalization and employment relations as reflected in the operations of the Hyundai Motor Company (HMC) in
Korea, Canada and India. After the closure of its short-lived attempt to manufacture cars for the
North American market from Canada, the HMC ‘relaunched’ its globalization strategy in India
…show more content…
By the end of the 1970s, the Korean industry had three local producers: Hyundai, Kia (which had taken over Asia Motors) and
Daewoo (which had absorbed Shinjin Motors). However, a global economic recession in late 1979 resulted in a severe excess capacity for manufactured vehicles and the Korean government announced a ‘Decree to consolidate the
Automobile Industry’ in 1980. The plan required that small passenger cars would be produced solely by Hyundai and Daewoo; that Kia would concentrate on small to medium commercial vehicles; and that only buses and large trucks would be open to competition. This resulted in a substantial contraction of the industry and, by 1983, vehicle production had declined to the levels of 1979. However, production grew steadily again during the mid to late 1980s and expanded substantially in the 1990s (see Table 1).
The 1980s and 1990s were a period of mass production as all three major companies built up their annual capacities and began aggressively to export
Table 1. Korean automobile production and exports for selected years
Production (000s)
1976
1981
1986
1991
1996
2001

Domestic Sales, %

Exports, %

49
133
601
1,497
2,812
2,946

97.5
81.3
49.1
73.9
57.0
49.1

2.5
18.7
50.9
26.1
43.0
50.9

Source: Korean Auto Manufacturers Association, Statistical Reports (various years).

Globalization & Employment in Korea

133

Table 2.

Related Documents