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The acquisition and restructuring of Kia Motors By Hyundai Motors

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Clémence D

on 17 November 2014

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Transcript of The acquisition and restructuring of Kia Motors By Hyundai Motors

A NEW STRATEGY
WORK EXCHANGE
BRIDGES BETWEEN 2 DIFFERENT ORGANIZATIONAL CULTURES
FOR MANAGEMENT
WHY?
to show strength and weaknesses
of methods
FIELD WORK SYSTEM
HORIZONTAL
Growth
Focus on product line in one industry
Under one management
TRUST
&
TRANSPARENCY

HANDS-ON MANAGEMENT
TO IMPROVE:
EFFICIENCY
COMMUNICATION
UNDERSTANDING
For executives of both companies
Assigned to the assembly line

Experience the atmosphere
Get a sense of community

If Hyundai merges with Kia:
The Acquisition and Restructuring of Kia Motors by Hyundai Motors
Case Studies
Winter Semester 14/15
Anne-Katrin Herzog
Marcus Merten
Annika Halla
Xhino Ago
Clémence Debarle
César Sévilla
The companies
Effects of the acquisition
Reorganisation of the Group and integration
Cultural Integration
Conclusion
Construction of a Global Network
Korea's Automobile market in a bad state
Hyundai needed to solve the problem of overproduction
Kia has strenghts:
International competiveness
Integrates a global system
Synergy effects !
Kia will give Hyundai expertise and infrastructure for exporting to the global market
Acquisition on October 19, 1998
High production capacities
Economies of scale
Improving international competitiveness
Easier to invest in Joint Venture
Monopoly ?
Same range of products
Less choices for the consumer
To have a successful acquisition, the group need to accomplish important tasks !
Need to preserve Kia's Business Resources !
Before Peter Schreyer
After Peter Schreyer
Who is the little brother
?
Background of
Hyundai Motors
Background of Kia Motors
Hyundai Kia Automotive Group
5th largest automobile manufacturer
chairman & CEO:
Mong-Gu Chung
1947 establishment as a construction company
1967 foundation of “Hyundai Motors” by Chung Ju-yung in Seoul, South Korea
1944 foundation in Korea
1952 production of bicycles
1973 first car “Brisa“
Mid-1990s: disinvestment lead to heavy losses
July 15, 1997 declared bankruptcy
"Together for a better future"
Vision
of a global player with strong synergy effects
Reorganization of the Automobile division
Integration of Management
Installation of the Automobile
Division Planning coordination commitee
Integration of the Business Division
Coordination of the Business Division
Organizational changes
Platform integration
Concerted efforts made a good acquisition
Some issue remained unresolved after the acquisition:
-Employees
-Companies' cultures

Thank you for your attention !
Back in black 1999 with sales of KRW7, 9 trillion and profits of KRW135,7 billion
Reborned as a blue chip company with a financial structure and a dept rate 148%
Revitalized Management at Kia Motors
The End of Legal Management
Domestic and overseas Outcome
Domestic sales increased 72% over the previous year
Export sales increased 53% over the previous year
The outcome of restruction
Strong synergy effects had been achieved
Restructuration of Kia was largely achieved
Agenda
The companies
Effects of the acquisition
Reorganisation of the Group and integration
Cultural Integration
Conclusion
2013
Sales revenue:
65 billion € Hyundai / 35 billion € Kia
Global retail sales :
4.6 million cars Hyundai / 2.88 million cars Kia
Employees:
60.000 Hyundai / 34.000 Kia
Economies of Scale







Economies of Scope
Nadal Spot (2002)
Background
Full transcript