The addition of a third shift and 877 more jobs at Montgomery's Hyundai plant puts it in rare company -- it's one of only a handful of facilities worldwide where the Korean automaker is increasing production capacity.
That's not because of a lack of demand. Hyundai has rocketed to the world's No. 5 automaker and is on pace for a record-setting year of sales.
But the company has decided to stop its physical growth to save something that was much harder to build than its cars: its reputation.
"Back in the 1980s and 1990s, as you well know, we had quality problems. And we own up to them," Hyundai Motor Co. global spokesman Frank Ahrens said Monday while visiting the Montgomery facility. "If you focus too much on numbers, you're going to lose quality, and that's exactly what happened to us."
That began to turn around when the company launched a 10-year, 100,000-mile warranty in 1999, a move that Ahrens said most in the industry at the time considered "ludicrous," especially for a Hyundai car.
"You would think the warranty costs alone would cripple the company," he said. "But we knew by that point that our quality was on a road to improve so that we could do that kind of Hail Mary."
It worked, and Hyundais now are routinely ranked among the most reliable and efficient automobiles in the world. They're also in demand, with products like the Montgomery-produced Sonata selling nearly as quickly as the plant can make them.
But Ahrens said the fear is that, in growing too much too fast, the numbers could once again take priority over quality and service. "Every company talks about quality, but in our recent history we had poor quality," he said.
In addition to the Montgomery expansion, Hyundai plans to open a 400,000-capacity plant in China within the next few weeks. There's also a new 150,000-capacity factory under way in Brazil and a 100,000-capacity expansion in Turkey.
"Once these are all online, that's where we're going to take the pause for a little while," Ahrens said.
Meanwhile, the company is hedging its bets in the world economy by spreading its production and sales evenly across Asia, America and Europe. It's a unique strategy in an industry where companies such as Volkswagen and Ford emphasize one nation.
"We're not overly reliant on one market of the world," Ahrens said. "If one section goes down, the rest can take up the slack."
Currently, its "shining star" is Hyundai Motor Manufacturing Alabama, which produces most of the cars that the company sells in the United States. America now has passed Korea to land at No. 2 in worldwide sales regions for the company. At 356,000 sales through the first half of 2012, the U.S. is "nipping on China's heels" for first place.
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