economics of globalization eco 4451

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Hyundai Motor Group, Inc.

Currently, the Management of Hyundai Motor Group is reviewing its North American operations. In this process, it has hired your consulting firm to provide an outlook on the prospects of moving their operation from Montgomery, Alabama to another site. The company faces an uncertain future with US trade restrictions and tariffs. The CEO has tasked you with developing the plan of action for the company’s automotive division (this includes Hyundai and KIA). The CEO needs your recommendation of possible location choices to minimize any financial damage that the company would face if the trade situation worsens in the future. Currently, approximately 30 percent of cars produced in the company’s US plants are exported to countries throughout the world except for China. The CEO wants your recommendation of possible location changes for the US operations. The company will likely not change location; however, the CEO wants to keep all options available for the near future.

You will need to do your research on the several factors for this assignment; these include but are not limited to:

  • Relationship with the South Korean Government
  • Availability of raw materials
  • Availability of trained labor
  • The ability of migration for senior and mid-level employees
  • Proximity to markets
  • The ability of the suppliers to also locate
  • Shipping costs of materials
  • Reliability of shipping
  • Infrastructure needs/situation.
  • Transportation costs of exports
  • Government subsidies to locate

The CEO wants to have several options (at least 3) presented for planning purposes. While the operation will likely not move, the plan gives the company leverage in future negotiations. The report needs to address all the critical issues in the above list.