HYUNDAI

Hyundai's Discriminative Strategy and CSR

Hyundai's Discriminative Strategy and CSR

Introduction

The automobile industry carries a significant meaning to the national economy, since it has great influence across all of the industries. Historically, we have observed that the success of motor business contributed to the rapid economic growth of the entire country. As a result of this attraction, many developing countries still work to set up the automobile industry so that they use it as a foothold for the rapid economic growth. It seems a brilliant idea as the industry brings an excellent opportunity to utilize other related businesses with a stable job creation. However, it is not simple work as motor business requires a large investment, technical basis, and stable customer basis in fierce competition. For this reason, we also have observed that several new companies ended in failure and it causes enormous loss throughout the national economy.

Newcomer has to overcome many obstacles including technical skills and market sharing, in order to compete with existing motor companies in the market, and it tells that motor business could be very dangerous business that might bring serious and chained damages to the entire country in case of failure. Thus, automobile industry usually get supported and encouraged through at the state level, and it is essential to newcomer in order to compete with existing competitors in the globalized market. In other words, the key to newcomer's success is not only own capability of management but also the cozy relations between politics and business.

Background

In view of business, many analysts say that Hyundai's aggressive marketing is a key role that leads to success in the U.S. market. Hyundai has increased marketing cost during recent worldwide recession whereas most companies reduced it. Hyundai-Kia takes overwhelming advantage through governmental protection, so their market share is recording almost 80% in Korea. In fact, Korean government imposes four kinds of additional taxes for imported car including 8% tariff, and it has been crucial role for keeping their market share for a long time. According to an example of calculation, if the customer bought $60,000 car in the U.S., this customer should more pay $20,000 for tax in order to own this car in Korea (Amine, 2003).

Since 50 years, Hyundai has been supported by the government, which is the main driving force for which Hyundai was able to invest to continuous research and development strong customer basis. Whether it is forced or not, Korean customers loyalty for their domestic cars was solid, and the loyalty for Hyundai was considered to the cooperation for country's growth rather than feeling as deprivation of product choice (Amine, 2003). It is one of special advantage that Hyundai could get from the national traits of the Korean, and it is the reason that Korean people expect advanced social responsibility from Hyundai.

Hyundai Success

Hyundai-Kia Motor is one of Hyundai group's affiliated companies, which is the largest automobile manufacturer in South Korea. Since, the group acquired 51% shares in Kia motors, which was the, second largest car company in Korea, ...