By Ryu Jin
Staff Reporter
Hyundai Automotive Group Chairman Chung Mong-koo has been busy taking care of overseas production and marketing strategies for years. Under his global management, Hyundai Motor and Kia Motors have expanded their overseas production capacity and their combined annual vehicle output in foreign plants is expected to breach the million mark for the first time this year.
Hyundai Motor produced 435,629 vehicles overseas in the first half of the year, according to the Korea Automobile Manufacturers Association (KAMA).
When combined with the 120,424 units produced at the overseas plants by Kia Motors, the total production of the two automakers reaches 556,053 units.
Company officials expect the combined production abroad willsurpass one million this year if the current pace is maintained in the second half of the year. Last year, the group produced 964,842 units abroad.
South Korean carmakers’ overseas production capacity has grownnearly 10 times from five years ago. In 2002, overseas production of the country’s five finished carmakers stood at 129,439 units, including Hyundai Motor’s 109,354.
Hyundai Motor and Kia Motors have expanded their investment in overseas markets as they struggle with militant labor unions and sluggish domestic demand.
Hyundai Motor operates factories in the United States, China, India and Turkey and is building a new plant in the Czech Republic, while Kia Motors is also upgrading its plant in China and has completed a plant in Slovakia.
``Not to mention the one-million-unit goal, we expect our overseas production could near 1.5 million units this year,’’ said a spokesman for the group, which now ranks sixth largest in the global car industry and aims to become one of the world’s top five automakers by 2010.
Hyundai and Kia are performing strongly this year, especially in the global market. Last month, Hyundai Motor said its net profit stood at 612 billion won ($668 million) in the second quarter, up 52 percent from a year earlier.
Sales increased 14.6 percent to 8.03 trillion won in the period and operating profit also reached 572.8 billion won, the highest in three years.
``Our latest performance, which displayed improvements in operating margins for three consecutive quarters, proved that the company is strong enough to counter the negative effects of a stronger won,’’ the spokesperson said.
Hyundai Motor has a domestic market share of over 50 percent and, when combined with the 23-percent share of Kia Motors, the automotive group’s market share reaches over 70 percent.
Sales of Hyundai Motor in the United States hit the milestone of five million units earlier this month, 21 years since the company began selling motor vehicles to the world’s largest automobile market.