Friday, January 24th, 2014
SEOUL, KOREA - As Hyundai Motor and Kia Motors have been growing rapidly for the past decade, their suppliers are also benefiting mightily from spillover effects. The two auto makers said on January 23 that the total number of new employees in their 330 primary partner firms was 17,215 last year, up 18.5 percent from the previous year's 14,531.
For example, Hands Corp., a specialist in aluminum wheels for Hyundai and Kia, has focused on the single item since its founding in 1972. Its sales revenue in 2002 was only 115 billion won, with only one manufacturing plant in Incheon. In 2012, the company's sales revenue quintupled to 585 billion won, with a new Chinese plant in Qingdao. Takata Korea, the primary supplier of seat belts to Hyundai and Kia, hired 436 new workers last year alone from about 500 employees.
A Hyundai Motor official said, "Including the number of new hires in 5,000-plus secondary and tertiary suppliers, the total employment effect would be much higher." According to a recent study, the 250 partner firms to Hyundai Motor and Kia Motors saw their average sales revenue triple to 370 billion won in 2012 from 125 billion won in 2003. During the same period, their per-capita sales revenue (a rough measure of workers' productivity) has jumped to 667 million won from 280 million won.