Hyundai Motor in Beijing and Ulsan

Beijing Hyundai Motor, the Chinese affiliate of Hyundai Motor, sold 1.12 million vehicles in China last year, and ranked fourth in overall sales, beating Japanese companies. It was truly good news to Hyundai that has struggled in Korea due to a sluggish domestic economy and aggressive sales campaigns staged by import car suppliers. Having increased visibility, Hyundai Motor plans to expand its sales structure centered on small and compact vehicles to one centered on mid-sized or larger luxury vehicles in China.

Hyundai has made robust growth in the Chinese market thanks to flexible production and sale systems through cooperation between labor and management. When this reporter met him at Beijing Plant 3 recently, Kim Tae-yoon, head of Beijing Hyundai, said, “We have had no single delay in plant construction and production schedules owing to cooperation by the labor union. Unlike the automaker’s Ulsan plant, the Beijing plant is designed to allow for flexible control of production speed and adjustment of overtime work hours in tune with sales volume, and work positions of staff members can be adjusted easily. At Ulsan plant, it is difficult to produce more than three types of vehicles at a single plant, but at Beijing plant, it is possible to produce four to five types of vehicles together.

Wang Jenping, chief of Beijing Hyundai’s labor union, said, “It is desirable that staff members join hands and help develop the company, and thereby guarantee interests and gains of staff members,” stressing that if the labor union only seeks employees’ interests and thus causes conflict between the labor and union, it will cause damage to the company and state as well. What the union seeks to keep is legally recognized interest, and not illegal interest. The union at the company is making far-reaching efforts to enhance the image of Hyundai Motor and its employees in Chinese society as well.

The average monthly salary for production staff at Beijing Hyundai is reportedly about 7,000 yuan (1,128 US dollars). It is nearly three times the average starting pay of 2,500 yuan (402 dollars) for a college graduate paid by Chinese companies, but Kim said the amount is just one sixth of what is cost at a plant in Korea. The time required to produce one vehicle amounts to 27 hours on average at Ulsan Plant, and 17.6 hours in Beijing plant, as the latter boasts of higher productivity. Kim Bong-in, head of the production division at Beijing Hyundai, said, “Looking at workers at our factory, I feel proud in one aspect, but feel regrettable as I recall the situation in Korea." This reporter came to have the worry that unless Hyundai Motor and Kia Motors’ labor unions join hands and drastically increase labor competiveness of domestic plants, it will be impossible to slow the accelerating trend of overseas vehicle production by Korean automakers.