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Hyundai’s Alabama plant aims for record production output in 2013

MONTGOMERY, Alabama — It was just two short years ago that Hyundai Motor Manufacturing Alabama announced its annual economic impact on Montgomery County and the State of Alabama.

That annual economic impact was $1.5 billion in the county and $2.8 billion in the state, and that was for 2010. Since that time, HMMA, which produces the Sonata and Elantra, has added nearly 1,100 jobs and a capital investment of more than $200 million. The company, which opened in 2005 with about 2,000 employees and a $1 billion investment, has experienced phenomenal growth – 3,100-plus employees today and a capital investment of about $1.7 billion.

“I think the fact that we’ve had such a significant overall economic impact in the state validates the actions of not only the State of Alabama, but the city, county and the efforts of the chamber (Montgomery Area Chamber of Commerce) to attract Hyundai here in the first place,” said Rick Neal, senior vice president of administration & advisory general counsel for HMMA.

“I think we have exceeded all of their expectations and we’ve certainly exceeded most of our own with the success that we’ve had, and we continue to enjoy excellent cooperation from all those entities. It’s really a partnership that has benefited all parties.”

How has HMMA managed that growth? How do you go from producing 250,000 vehicles in 2007 to this year’s goal of 388,000 units? The Montgomery plant is one of the top automotive production sites in the country for output. (Its April output was a record for the facility.)

“Our use of ergonomic devices and our increased use of robotics; our use of advanced manufacturing techniques and technologies enables us to produce more vehicles generally with less team members than comparable older facilities,” he said. “It is one of the most highly automated manufacturing facilities in the world even to this day.”

Neal said that dramatic growth follows increased demand. “Designers of our vehicles have created products that have resonated with the public, which has resulted in increased sales and a need for us to produce more vehicles.”

That increased demand led to adding employees such as the 877 who were hired for the company’s third crew/third shift last year.

“All of our team members and especially all of our management team members have the job of ensuring we produce a higher number of high-quality vehicles – all are committed to the success of the company,” Neal said. “We experienced that last year when we went to our three crew/three shift production model. We were given a very short time in which to recruit, hire, train and put to work 877 new workers. We did it in three months and that’s because everybody is conditioned to moving at Hyundai speed. That intensity, focus and drive comes all the way from headquarters.”

There was a snag, however, that with all the new workers in production, quality declined, and according to Neal, “suffering a diminution in quality is not acceptable at Hyundai.” He said they were ordered to restore the quality to Hyundai standards. “Everybody had their assigned roles and responsibilities and we all worked together and pulled in the same direction as a team.”

It took two months, but HMMA was back at the quality targets set by headquarters in Seoul, Korea. Neal said the company achieved a 95 percent first-time through ratio.

“We have a very structured hierarchical management chain. The objective starts at the top and gets filtered down through all the levels of management and it goes all the way down to the production team member level, where you basically have to train individuals on how to properly do their job and complete their process in the necessary time without causing any in-system damage to the vehicle. With a concentrated effort campus-wide we achieve results.”

Hyundai stresses the team concept. “We look at every shop and every process has its own customer and that customer is an internal customer here at HMMA,” Neal said. “The process starts at stamping and stamping has to do their job properly so that they can give their customer, which is body and weld – what body and weld needs. And body and weld has to do what they need to do in order to give the paint shop what it needs to do its job. And so forth it goes down the line so we’re all very interconnected.”

Back in January 2005, then-HMMA President M.H. Lee addressed the employees and said a new plant and new products will not make Hyundai great – it’s the employees that can make Hyundai great.

“I want to say how proud I am of all our team members,” Neal said. “They work incredibly hard. They are dedicated to the company. They put in the overtime when it’s required for us to meet the demands of our customers.

“And last year their generosity of spirit and actual monetary contributions to causes like the United Way, Toys for Tots, Montgomery Area Food Bank and others – completely blew me away. I was concerned how our new three crew/three shift team members would respond, but they also came through in a big way. We enjoyed our largest drives for all of those charitable organizations.”

The employees donated $238,000 to United Way and with the corporate donation, HMMA gave $300,000 and gave 442 bicycles to Toys for Tots compared with 283 the previous year.

“That’s extremely gratifying,” Neal said.





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