Hyundai Motor Company in the Indian Market

Abstract

This case study describes the strategies of Hyundai Motor Company for entering and working in India, as part of its global management strategies. With its huge potential in market development, India attracted worldwide attention and was a place of fierce competition among global corporations. In the automobile industry, Hyundai Motor India (HMI) went into the production of national vehicles for India's citizens through localization of products and marketing as well as standardization of manpower and organization. This study will examine the strategies and role of HMI as the future leader of domestic markets and outpost for global exportation.

Why Localization Is Necessary as a Business Strategy in Emerging Markets: The Case Comparison of Hyundai and Volkswagen

“…Indian society is known as hierarchical and strict, mainly due to its Caste system. A combination of tropical monsoon climate, an agriculturally oriented traditional society, Hinduism and the remnants of English colonialism influenced the local culture of Indian citizens [33]. These characteristics appear in workplaces where Indian workers tend to give in to authority.…”

“…Mentioned in the case study of Hyundai Motors in the India market by Park and Rhee (2015), Hyundai Motors constantly appealed to India's government by proposing massive production in India along with over 70% localization of parts within four years, as well as transferring technologies to India [33]. Through these efforts, Hyundai Motors received authorization for independent investment from the Indian government in 1996, while other multinational enterprises were struggling with their local partners.…”

“…According to Park and Rhee (2015), India displays 'ultimate road chaos' due to backward infrastructure and decline in traffic safety awareness [33]. To overcome these infrastructural voids, HMI focused on CSR campaigns to increase awareness of traffic safety.…”

“…Furthermore, HMI identified the cultural characteristics of Indians and applied them effectively in human resource management. Due to the unique culture that is derived from the caste system, Hinduism, and English colonialism, Indians display a characteristic of having low loyalty towards the company with high absenteeism [33]. HMI applied the cognitive structure that lies behind the caste system to manage employees and tried to increase employees' sense of ownership towards the company.…”