Locations -- Montgomery, Ala.

Dec. 21, 2004

Hyundai Motor Co.'s first assembly and manufacturing plant in the U.S. will produce 300,000 vehicles per year when it reaches full capacity.

John McClenahen

Plant Hyundai Motor Co., South Korea's largest automotive producer, is building a US$1 billion assembly and manufacturing plant in Montgomery, Ala. Production at the facility, Hyundai's first assembly and manufacturing plant in the U.S., is slated to begin in 2005. The plant is expected to produce 300,000 vehicles per year when it reaches full capacity, with sedans and sport-utility vehicles comprising the product mix. Groundbreaking for the facility, which the company figures will create about 2,000 jobs, took place on April 16. The site is now in unincorporated Hope Hull, Ala., and is slated to be incorporated into Montgomery. The new Hyundai plant will not be Alabama's only automotive facility, however. In August 2000, DaimlerChrysler AG announced a $600 million investment to expand production capacity at its Tuscaloosa site for sport-utility vehicles. And last year, Toyota Motor Corp. announced plans to build a $220 million engine plant in the Huntsville area. Corporate Strategy Hyundai's decision to build a plant in Montgomery was based in large part on the automaker's continued strong sales and market-share showing in the U.S. Last year, the Hyundai Automotive Group -- Hyundai Motor America and Kia Motor America in the U.S. -- sold 569,956 units, a 29% increase over 2000 sales. Also factoring into Hyundai's selection of Montgomery were the presence of a high-quality workforce, proximity to markets, an established automotive parts supply chain, and commitments made by the state of Alabama and the city of Montgomery. This past March, the Alabama legislature approved a $118 million incentives package in hopes of attracting Hyundai. State and local incentives, approved or agreed upon, total $234 million. "Our decision to build this facility in Montgomery, Ala., underscores our commitment to the U.S. market," says Mong Koo Chung, chairman of the Hyundai Automotive Group. Production Strategy Hyundai's choice of Montgomery for a production facility seems to be a classic illustration of applying the strategic principle of being close to customers. For Hyundai, that translates to selecting a site allowing it to better meet demand and accelerate delivery. "Our new plant will allow us to build more vehicles for this growing market and get them to our customers more quickly while continuing to produce the high-quality, well-styled, high-value products that our customers have learned to expect from Hyundai," asserts Chung. Community Montgomery, the capital of Alabama, is home to a campus of Auburn University and to the anti-discrimination Southern Poverty Law Center. Montgomery has a fairly diversified manufacturing base, from food and furniture to software engineering. There's a growing IT industry, with 125 companies located in Montgomery. Population of the city is 201,568, and the Montgomery metro area totals 333,055. Locations profiles selected siting and facility strategies by manufacturing companies. Send submissions to Senior Editor John S. McClenahen at [email protected].

About the Author

John McClenahen | Former Senior Editor, IndustryWeek

John S. McClenahen, is an occasional essayist on the Web site of IndustryWeek, the executive management publication from which he retired in 2006. He began his journalism career as a broadcast journalist at Westinghouse Broadcasting’s KYW in Cleveland, Ohio. In May 1967, he joined Penton Media Inc. in Cleveland and in September 1967 was transferred to Washington, DC, the base from which for nearly 40 years he wrote primarily about national and international economics and politics, and corporate social responsibility.

      McClenahen, a native of Ohio now residing in Maryland, is an award-winning writer and photographer. He is the author of three books of poetry, most recently An Unexpected Poet (2013), and several books of photographs, including Black, White, and Shades of Grey (2014). He also is the author of a children’s book, Henry at His Beach (2014).

      His photograph “Provincetown: Fog Rising 2004” was selected for the Smithsonian Institution’s 2011 juried exhibition Artists at Work and displayed in the S. Dillon Ripley Center at the Smithsonian Institution in Washington, D.C., from June until October 2011. Five of his photographs are in the collection of St. Lawrence University and displayed on campus in Canton, New York.

      John McClenahen’s essay “Incorporating America: Whitman in Context” was designated one of the five best works published in The Journal of Graduate Liberal Studies during the twelve-year editorship of R. Barry Leavis of Rollins College. John McClenahen’s several journalism prizes include the coveted Jesse H. Neal Award. He also is the author of the commemorative poem “Upon 50 Years,” celebrating the fiftieth anniversary of the founding of Wolfson College Cambridge, and appearing in “The Wolfson Review.”

      John McClenahen received a B.A. (English with a minor in government) from St. Lawrence University, an M.A., (English) from Western Reserve University, and a Master of Arts in Liberal Studies from Georgetown University, where he also pursued doctoral studies. At St. Lawrence University, he was elected to academic honor societies in English and government and to Omicron Delta Kappa, the University’s highest undergraduate honor. John McClenahen was a participant in the 32nd Annual Wharton Seminars for Journalists at the Wharton School at the University of Pennsylvania in Philadelphia. During the Easter Term of the 1986 academic year, John McClenahen was the first American to hold a prestigious Press Fellowship at Wolfson College, Cambridge, in the United Kingdom.

      John McClenahen has served on the Editorial Board of Confluence: The Journal of Graduate Liberal Studies and was co-founder and first editor of Liberal Studies at Georgetown. He has been a volunteer researcher on the William Steinway Diary Project at the Smithsonian Institution, Washington, D.C., and has been an assistant professorial lecturer at The George Washington University in Washington, D.C.