MOTOR COMPANY REACHING A TOPNOTCH AUTO COMPANY October, 2004
MOTOR COMPANY I. Auto Industry : National Economy’s Backbone 2
Auto Industry = Total Package of Industries MOTOR COMPANY Auto Production Manufacturing autos, production of parts Auto Sales and Maintenance Processing Raw Materials Auto sales/maintenances selling parts… Steels, chemicals, rubbers…. . Oil Industry Stationaries, petroleum refinery, lubrication…. . Finance and Insurance Transportation and Utilization Installment finance, auto insurance… Passenger/freight transportation, parking lot, auto lease…. 3
A Country with Strong Auto Industry leads the World Economy MOTOR COMPANY Late 19 th Century Early 20 th Century Late 20 th Century 21 st Century W. Europe USA Japan New Comers Invention & Supply Popularization Globalization Auto Industry Concentration Economic Take-Off World Economy Domination Gain Huge Economic Power Economic Take-Off Stream/Galoline Auto Invention Growth of Ford & GM Fast Growth After the Oil Shock Korea, China, etc 4
Growing Auto Industry Leads to a Developed Country MOTOR COMPANY Auto Production Amount by Countries (2003) GDP/Capita (2003) Thousand 12, 140 1 st : USA 10, 150 2 nd : Japan 6 th : S. Korea 33, 720 US $ 5, 500 3 rd : Germany . . . 37, 748 US $ 29, 201 US $ . . . 3, 280 12, 646 US $ Data: Korea Automobile Manufacturing Association, , Bank of Korea 5
Auto Industry Is the “BACKBONE” of Nation’s Economy MOTOR COMPANY (1200 Won = 1 US $) Production Added Value Export Tax 58 Billion US $ → 11% of Manufacturing Industry 22. 5 Billion US $ → 11% of Manufacturing Industry 23 Billion US $ -> 12% of Whole Industry 17. 5 Billion US $ → 18% of Total Taxes Data: Korea Automobile Manufactures Association, National Statistical Office 6
Auto Industry Accounts for the Largest Portion of Employment MOTOR COMPANY l Auto industry creates more jobs than any other industry -Directly/indirectly: 1. 5 million employments EMPLOYMENT SCALE Automotive 280, 000 people Semiconductor Steel Shipbuilding 170, 000 people 90, 000 people 60, 000 people Data: Korea National Statistical Office 7
MOTOR COMPANY Ⅱ. Heading Towards a Topnotch Global Company 2. Company Overview 8
40 Years of History MOTOR COMPANY ’ 67 ’ 76 Establishment of HMC ’ 86 Export to The US ’ 91 ’ 96 ’ 99 10 million cars in total sales volume Development of Proprietary Engine Independently Design model : PONY ’ 00 ’ 02 HMC separating Beginning to construct The US Plant ’ 03 ’ 04 Beginning to construct European Plant From Hyundai Group Export of 1. 75 Million per year Acquisition of KMC Factory in China: into operation 10 million cars in Total export HMC INTO A GLOBAL COMPANY 9
Global Sales : 7 th World ranking MOTOR COMPANY Global Sales (Year 2003) Toyota Ford VW DCX PSA HMC/KMC Nissan Honda Renault HMC 8, 590 Thousand GM KMC Total 6, 780 Thousand 6, 540 Thousand 5, 020 Thousand Revenue 20. 8 Billion US$ 10. 7 Billion US$ 31. 5 Billion US$ Net Income 1, 460 Million US$ 589 Million US$ 2, 049 Million US$ 30, 000 80, 000 4, 360 Thousand 3, 290 Thousand 3, 050 Thousand (Number 7) 2, 970 Thousand 2, 910 Thousand Employment 50, 000 2, 290 Thousand * Number of global sales Data: MARKET DATA BOOK (’ 04, AUTOMOTIVE NEWS ) 10
Exporting 1. 75 Million Vehicles to 185 Countries (’ 03) MOTOR COMPANY ( ) : percentage W. Europe 370, 000 (21%) E. Europe 70, 000 (4%) <Overseas Sales Network> l Regional l Import Headquarter : 10 Agencies : 320 ; Asia/Oceania 260, 000 (15%) Dealers 7, 750 ; Africa/Middle East 170, 000 (10%) North America 800, 000 (46%) A/S 8, 500 South America 80, 000 (5%) 11
3. 8 Million Global Production Capacity MOTOR COMPANY Unit ; 1, 000 Europe 300 Construction begins (‘ 04. 4) Turkey 60 Korea 60 3, 200 USA 300 Construction begins (’ 05. 3) China 50 100 250 India 150 250 120 CKD Assembly Plant l l Hyundai (210, 000) Kia (300, 000) Year ‘ 03 Year ‘ 04 3, 510 3, 760 : Taiwan, China, Egypt, Pakistan, Sudan, Russia, Venezuela, Malaysia, Indonesia, Iran : Iran, Egypt, Philippines, Vietnam, Pakistan, Malaysia, Ecuador, Morocco, Russia, China, Indonesia 12
Full Line-up MOTOR COMPANY Propriety Models : 55 FULL-LINE UP ▷ HMC 34 + KMC 21 HMC/KMC : 28 (’ 03) 55 (Accumulated) 30 25 23 20 15 The 1 st Proprietary Model: Pony 10 9 5 1 1 ‘ 75 ‘ 80 4 0 ‘ 85 ‘ 90 ‘ 95 2003 13
MOTOR COMPANY Ⅱ. Heading Towards a Topnotch Global Company 2. Competitiveness 14
Shortly, HMC/KMC Became Global Maker MOTOR COMPANY HMC/KMC has the “world speed record” for 3 million autos production Brand Established year Company’s Age HMC/ KMC 1967 36 yrs Toyota 1937 67 yrs Nissan 1933 71 yrs VW 1938 68 yrs Ford 1903 101 yrs Peugeot 1896 108 yrs Period reaches to manufacture 3 million autos 36 years (Year 2003) (1977) 40 years 47 years 52 years (1980) (1990) 68 years (1971) 105 years (2001) 15
R&D Capability Reached World-Wide Level MOTOR COMPANY 1 st Stage 2 nd Stage Importation of Techniques l Development of HMC’s unique model (1967~1975) 3 rd Stage (1976~1984) 1967 : Established HMC l 1976 : Built Korea’s first own model: Pony 4 th Stage Technical Independence Technology Competition (1985~1990) 1986 : Exported Exel to the US (1991~ l l l 1968 : Cooperation with Ford Co. l 1982 : Developed Stella (mid-sedan) l 1990 : Reached 1 million sales in US l ) 1991 : Developed Korea’s first own Engine 2000 : Developed common rail diesel engine 2003 : Sold Engine technology to DC and MMC 16
Top Class Quality Surpassed Toyota, BMW, Ford, Nissan in Quality (J. D. Power) MOTOR COMPANY HMC: #7 from 37 global brands (#2 from 14 companies) “Man bites dog” -Automotive News Comparison of HMC’s IQS in the US market Year 2004’s. IQS HMC Average 1 st: Lexus 87 7 th: HMC 102 9 th: Toyota 104 12 nd: BMW 120 22 rd: Ford 127 32 rd: Nissan 154 Data: J. D. POWER and Associates 17
Development of Advanced Engine Tech. & Exportation MOTOR COMPANY Exportation on Engine Technology Middle size engine Latest Gasoline Engine Overview l Meaning l Development l Joint Production with DCX and MMC 1. 5 million per year (world’s biggest in scale) HMC, DCX, MMC vehicles l l Advanced Diesel Engine Multi-injection Engine l having a various range of proprietary gasoline engines l Year 1999 l LPI Engine (LPG) Environment friendly diesel engine l World’s first liquefied injection in LPG engine High in horsepower / low in noise l 2 years ahead of Toyota Year 2000 l Year 2003 18
Development of Environmental-Friendly Vehicles Reaching World-Class Technology MOTOR COMPANY ▶ Corresponding Future Environment Standard • • Santa Fe electric vehicle started its drive in Hawaii (2001) Development of Click Hybrid (Oct. 2004): 50 cars were delivered to Korea Department of Environment Sales will start in 2006 • US DOE (Department of Energy) Award (April 2004) : Hydrogen Infrastructure & Fuel Cell Vehicle Demonstration 19
Changing of IP Management from Quantity to Quality Overseas Domestic (’ 95 ~ ’ 04) MOTOR COMPANY Patent Pending ’ 04 Patent Registration ’ 04 ’ 03 ’ 01 ’ 99 ’ 97 ~’ 95 ~ ’ 95 2, 000 4, 000 6, 000 8, 000 10, 000 50, 000 600 430 20 100 200 300 400 500 600 700 800
USA : Auto Sales Doubled During The Last 4 Years MOTOR COMPANY HMC/KMC Sales Volume/Market Share Sales Volume 60만 Sales Vol. ▲ 3. 3% Mkt Share 3. 7% ▲ 3. 9% ▲ 4. 2% ▲ ▲ Market Share 4% 3% 2. 3% 40만 1. 8% 2% ▲ ▲ 20만 1999 2000 2001 2002 2003 2004 F (DATA: : AUTOMOTIVE NEWS DATA CENTER ) 4. 1% Market Share in the US (2004 Jan~Sep, selling 520, 000 cars) 21
China : Extremely Fast Growth “Hyundai Speed” MOTOR COMPANY l Extremely high speed in growth created popular word--“Hyundai Speed” (Established Beijing Hyundai Motor in November 2002 → In 2003, 52, 128 vehicles were sold) l Beijing Hyundai was nominated as “fast growing company with high potential” HMC/KMC Production Plan in China (Unit: thousand) Year 2003 2004 2005 2010 Total Production Capability 100 250 400 1000 Hyundai 50 150 300 60 Kia 50 100 400 22
India : Becoming #2 Auto Maker During The Last 3 Years MOTOR COMPANY l Sales HMC’s Market Share In India - 60, 000(’ 99)→ 150, 000(’ 03)→ 220, 000(’ 04) - Santro, Accent, Sonata, Best selling cars in each segment l Great Contribution (Indian Economy) - Created 50, 000 employees - Recorded number one in tax payer in state of Tamiladu, India 23
MOTOR COMPANY Ⅱ. Heading Towards a Topnotch Global Company 3. Mid/Long Term Goals 25
HMC/KMC Mid/Long Term Goals MOTOR COMPANY Periods ~ 2002 2003 ~ 2005 Advancement to China 2006 ~ 2010 Advancement to USA To Europe Brand Image Smart Buy Value Innovator Sales 2, 930, 000 (2002) More than 5, 500, 000 (2010) 26
MOTOR COMPANY Thank You Always there for You! 27
