April 4th, Accounting and Financial Statements:

The recession's (2008-2009) effects on companies' balance sheets.

Well, the economy is a connected piece as a whole. So anything that affects a part of it, might affect another part. When the recession happened, it affects everything in the economy. The financial crisis affects the auto industry dramatically and by observing the balance sheets for some companies, we can see the effects. Almost each car company has been affected from the recession and that the liabilities in their balance sheets are higher than the total assets. Although those companies are recovering now, they still have more liabilities and obligations.

For example:

Ford's balance sheet:

2007: the total assets are more than the liabilities

Assets: 279, 264, 000 - Liabilities: 273, 636, 000

2008: the total assets are less than the liabilities

Assets: 218, 328, 000 - Liabilities: 235, 639, 000

From 2008 to 2010, the total assets for each year is less than the liabilities. This means that there is an obstacle in the financials that need to be solved.

References:

http://finapps.forbes.com/finapps/jsp/finance/compinfo/FinancialIndustrial.jsp?tkr=F

Marketing March 21st

What are some recent consumer behavior trends that are influencing the industry?
-Since the economic downturn in the United States as well as the growing green movement, consumers have been buying more affordable and fuel efficient cars. There has been a recent trend in buying mid-sized sedans because they are the most affordable for the size.

What is the competitive landscape in the USA?
-The main domestic car companies in the United States are Ford and Chrysler. However, these companies are no longer competing solely with each other. They are now competing with a global market that includes companies like Toyota and Volkswagon.

How do companies in this industry differentiate themselves from one another?
-Companies differentiate themselves by have different mission statements as well as different models. Although most cars have the same overall purpose, they vary in accessories and efficiency.

Nissan to Resume Production in Japan

The article talks about what Nissan and all other Japanese based motor-vehicle companies are struggling to reopen their factories and to start sales again.

I think that the Japanese natural disaster will affect the industry a lot more than we would expect. Once we pic which company we want to advertise in our final paper we should consider how the natural disaster affected its sales too.

http://online.wsj.com/article/SB10001424052748704433904576212341267269496.html?mod=WSJ_auto_LeadStoryCollection#articleTabs%3Darticle

Maketing: March 21, 2011

What are some recent consumer behavior trends that are influencing the industry?

It is quite obvious that when a consumer is looking for a product, they want something that in today's economy is fuel efficient, safe, reliable and is of good quality. It should also be stated that people also look into prices. You cannot buy an Aston Martin with $50,000. More recently people have switched to hybrids and cars that are very fuel efficient. The cost of gas is rising so many people are investing in smaller cars, because they take less gas and still get the job done. People have needs when buying cars. Like I said in a previous post people purchase cars based on needs and affordability.

I personally want all the characteristics mentioned above in my car. Design and style are a huge deal for me. Yes I want something as fuel efficient as a hybrid, but I want the style of a mustang. It can often be difficult trying to construct a car like that. For me the most important piece that a car must have is style. I want to look good in my ride.

Sources: http://blogs.chron.com/carsandtrucks/2009/05/what_do_consumers_want.html

http://cars.lovetoknow.com/Worldwide_Automotive_Statistics

March 21st– Marketing

• How do companies in this industry differentiate themselves from one another?


Hyundai motor is currently trying to increase their luxury cars sales in the U.S market. Due to the company image that Hyundai has in the U.S market, which is generally known as a company producing quality cars which is cheap, they have tried to create a new luxury brand(Vehicle of price more than $60,000). Hyundai have evaluated that it would be difficult for them to enter the luxury brand model in the U.S market with their current image. Just like the Lexus of Toyota, it would be the best way for Hyundai to launch a new luxury brand. If Hyundai is likely to produce luxury cars, they would have to compete with other vehicle models from different companies such as, BMW 3series, Benz C-class, Lexus, and Audi A4. In order to survive to from the market, Hyundai would have to differentiate themselves with own unique marketing strategy, and their solution was creating a new luxury brand called Equus. Hyundai is expecting to sell between 2500 and 3000 units this year.

As we can see, Hyundai is focusing very much on their marketing strategy for the market in the U.S. Besides creating a luxury brand, they are also changing their name of the vehicles from its origin name from Korea. Naming marketing seems to control a lot for company’s sales in the market. Moreover, it would be interesting to see whether Equus can stabilize in the market with their expected image as the luxury brand in near future.



http://www.ridelust.com/2011-hyundai-equus-is-a-serious-luxury-sedan-contender/
http://www.aiada.org/news-and-events/first-up-daily-news/1236-hyundais-equus-loaded-for-us
http://www.ohmynews.com/NWS_Web/View/at_pg.aspx?CNTN_CD=A0001136145

Informational interview

sorry for the late post :)


Informational Interview
While searching for an appropriate candidate for my informational interview, I found out that my father has some connections through Hyundai motors. Thanks to his help, it wasn’t difficult for me to find somebody to interview with.

My interviewee was Harry Eum from Hyundai motor company in Washington office. He is a deputy director of strategic department. I have asked him some questions and very gently he has answered me back with sincerity.

I started off with the first question asking him that how he had first entered to this industry.
He replied me back that he has entered Hyundai motor not because he had great interest on automotive industry, but on a very casual incidence. He told me when he was looking for a job, there was a recruiting booth installed at school when he was a senior. He achieved lots of information from the recruiting booth and he also added he felt the company was attracting because they told him he could have a chance to study in the U.S for the MBA programme by the support from the company when being employed. “Hyundai motor encourages employees who want to study more especially abroad like the MBA programmes in the U.S. They support you well enough when you actually decide to continue study, and well of course they expect from you more when returning back to their company” said Eum.

Moreover, I also asked some questions about which I had been curious about. I wanted to hear how Hyundai actually thinks of their brand image here in the U.S. Frankly saying, I have heard that Hyundai motor’s image here in the U.S is relatively cheap and low rated car compared to other foreign vehicles such as vehicles from Japan or Germany. He partially agreed with this opinion however he added some comments contrast to this statement as well. He said that in the past days, around 4-5 years ago, it was true that Hyundai had such an image of the company. However, selling vehicles in low prices compared to the other companies was part of their strategy to enter the market, and nowadays the perception from the market is changing compared to the olden days. It is now beginning to accept the Hyundai product with a fine quality, design and especially great with mileage. He also remarked that there is still a huge potent lying here in the U.S for Hyundai motors which they will try to focus more with new strategy and products to the market.

After his interview, I really felt proud of the company since my hometown company seemed to be doing great in the foreign market. Also I have felt that it would be interesting to see how Hyundai motors would try to input their new full luxury car models into the U.S markets. Overall, it was a pleasure interview and great experience for me as well and I would just hope this informational interview would help me and my teammates for the final paper as well.


Info of the interviewee
HARRY EUM
Deputy Director
Hyundai Motor Company Washington Office
1660 L Street, NW, Suite620, Washington, DC 20036
Phone)202 296 5550
email : hseum@hyundai.com

Marketing: March 21, 2011

The ways that auto companies differentiate themselves from one to another.

There are several ways that some auto industry groups follow to be unique. First, the price of the products as we learned from our book. The person whom I interviewed mentioned that for me. He says that being aggressive and easy to negotiate about prices increase the saling process. This what KIA is dong and it gives them a good market. Second, the use of promotions is really important for automotive customers. Companies provide buyers with free maintenance programs or sometimes even 200, 000 miles like Toyota. Sometimes there are discounts like the discounts on special days. For example, some companies made discounts on Labor day, Thanksgiving, and Independence day. Finally, engineering stimulation is a new method that has many benefits. For example, new devices that are environmentally-friendly to reduce the amount of CO2 in the air.

In my opinion, I think that there is another way auto companies can differentiate from one to another. The way of being timed with technological enhancements. In other words, auto companies should be up to date with any new technological developments. For example, when the iPod was created, some companies, such as BMW, Mercedes, and Infiniti introduced the iPod's cable. This cable connects the iPod with the car's computer. This allows drivers to play their iPods without touching it, just from the screen of the car or from the audio buttons. It also charges the iPod; in addition to that, Infiniti's cars can show pictures of singers in the car's screen if the iPod already has those pictures.

References:

http://www.simutechgroup.com/images/Brochures/Industry/automotive-pdf7792.pdf

Personal experience (informational interview)