Hyundai's Kim Dong Jin: "The preparation and experience are totally different. I don't think the Bromont plant was well planned and well prepared for volume production."
Twelve years, to be exact.
Hyundai's new $1.1 billion factory in Montgomery, Ala., which can produce 300,000 units annually, is not its first in North America. In 1989, Hyundai built a $400 million plant in Bromont, Quebec.
But the plant didn't meet expectations, so Hyundai stopped production in 1993 and shuttered the factory two years later.
Ironically, Hyundai built both plants to produce the Sonata sedan. But the similarities end there.
"The preparation and experience are totally different," Hyundai co-CEO Kim Dong Jin says. "I don't think the Bromont plant was well planned and well prepared for volume production."
Hyundai has begun building the Sonata, left, in the U.S. The Santa Fe is next.
Kim says "many, many reasons" led to Bromont's failure. They include:
There were other problems. A weak Canadian dollar made imported parts expensive. And Hyundai had to deal with a 62.5 percent North American content requirement for duty-free trade in North America.
Hyundai reviewed all those factors before deciding to build a plant in Alabama.
"We had very thorough study and preparation," Kim says.
Hyundai commissioned a much more extensive feasibility study this time. An outside consulting firm probed, among other things, the best size for the plant, the optimal levels of efficiency and automation, and what types of vehicles should be produced.
Hyundai will add production of the Santa Fe SUV at Montgomery next spring.
"So the preparation is totally different," Kim says. "And we have accumulated a lot of experience since the Bromont plant, so that's different."
That experience, Kim says, includes the plants Hyundai has built and operates in China, India and Turkey.
You may e-mail Norman Thorpe at [email protected]