Hyundai Motor Manufacturing Alabama, LLC
Keeping the Wheels Turning
by David Zaslawsky
MONTGOMERY – Long before the first Sonata rolled off the assembly line at Hyundai Motor Manufacturing Alabama’s plant here, financial experts were anticipating a dramatic economic impact to the region.
That economic impact continues to grow and grow. Consider this: Hyundai’s sister company, Kia, is building a $1 billion manufacturing plant 75 miles away in West Point, Ga., which will create about 2,500 jobs at the facility and another 6,000 jobs for suppliers, including the expansion of existing companies in Alabama and new ones locating in the state.
Of course, the site was selected because of Hyundai’s location and its established supplier network, which Kia will also utilize.
“Had we not been here, Kia probably would not have located where it did and you wouldn’t have the additional suppliers,” said Rick Neal, vice president legal and general counsel for Hyundai Motor Manufacturing Alabama.
ThyssenKrupp is investing $3.7 billion in a steel and stainless steel processing facility near Mobile and is expected to have about 2,700 employees when fully operational.
The German steelmaker’s decision to locate in Alabama might have been influenced by Hyundai’s auto manufacturing plant as well as the Mercedes and Honda production facilities and Toyota’s engine plant.
“I think Neal Wade (director) at the Alabama Development Office would tell you that with each major manufacturer locating in the state, it makes it easier to attract others,” Rick Neal said. Mercedes, Honda and Hyundai helped attract ThyssenKrupp because they see Alabama as a good place to do business.
“Attracting its first U.S. manufacturing facility to this community has got to improve (Montgomery’s) image and attract other businesses. It gets people to sit up and take notice –why did Hyundai pick Montgomery? What does Montgomery have that some other places don’t have? Maybe we should also consider that Montgomery is a good place to do business.”
Hyundai spokesman Robert Burns said the company’s financial impact is about $7 billion a year. He said the company spends $2.1 billion a year in Alabama. The numbers are staggering:
- Hyundai has invested $1.4 billion in its manufacturing facility
- There are 2,700 employees
- Hyundai’s annual payroll tops $200 million
- Hyundai suppliers have a combined 6,000 employees
- Hyundai suppliers have invested a combined $650 million
- Hyundai has 35 suppliers in Alabama and a total of 78 in North America
- Hyundai and its suppliers have generated an estimated 20,000 jobs, including thousands from new hotels, restaurants and retail outlets.
“What this facility has done for this region as a whole has been phenomenal – we all see that day in and day out,” Burns said.
The Hyundai plant, which sits on 1,744 acres, built 235,000 units last year – Sonatas and Santa Fes -- and has the capacity at full production to manufacture 300,000 vehicles a year.
“Our facility is considered one of the most modern manufacturing facilities in the world,” Neal said. “Our production processes have been featured on programs like ‘Modern Marvels’ and ‘National Geographic.’ We are very proud of our facility.”
The manufacturing plant has 250-plus robots in the welding shop, which is a completely automated process.
“When it comes out of the weld shop, the car is literally half made and human hands have never touched it,” Neal said.
The economic slowdown forced Hyundai to reduce its production schedule and work force. Employment peaked at about 3,200. No permanent workers were laid off, Neal said.
“Most companies like to have a cushion of temporary workers just for these sorts of (economic) conditions,” Neal said. “As soon as we resume the production schedule we would anticipate bringing on additional workers.”
The company had used 400-500 temporary workers.
“A lot of companies use temporary employees to be able to move with supply and demand and that’s exactly what we were able to do,” Burns said.
In addition to its massive economic impact, Hyundai plays an active role in the community through organized efforts such as Relay for Life or Joy to Life walks as well as employees participating in other projects.
“We take our role as a good corporate citizen very seriously,” Neal said. “We have five basic planks: We support the arts, diversity, health and fitness, education and the environment. We make a conscious effort to spread our donations throughout those five planks.”
Those donations total six figures annually, Neal said.