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Kia-Hyundai and the Effect of Overseas Expansion

The organization you work for is interested in expanding their business overseas. You have been asked to gather some preliminary information to help management decide on whether to pursue this idea further.

Use online resources to find an article describing an experience of either: (1) a US company or division that conducts business in a foreign country; or (2) a company or division based in another country which has started doing business in the United States. Perform searches on "joint venture," "licensing," or "strategic alliance." Based on your research submit a document to the managers of the organization which answers the following set of questions:

1. Was the company's experience positive, negative, or mixed? Justify your answer.

2. What legal or political barriers did the company have to overcome? What technological obstacles did the company encounter? What cultural or business differences did the company encounter? What problems did these differences create for the company? What did the company do to overcome the obstacles? Did the company handle cultural and business differences effectively? Why or why not?

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1. Was the company's experience positive, negative, or mixed? Justify your answer.

Company: Kia-Hyundai

Mixed experience - Initially, Hyundai had focused its expansion in the US and, more recently, China, but the opening of a plant in Slovakia signaled the 'real' beginning. With a 48.4% growth and 107,631 units in sales earned Kia-Hyundai the well-deserved title as 2003's fastest growing car brand in Europe. Seemingly, this South Korean car maker made a successful crack and has made its indelible mark in the European automotive market. In April 2004, it broke the ground for its first European factory in Zilina, Slovakia, with its strikingly suitable slogan "the power to surprise," Kia-Hyundai will take the wind out of other car makers' sail and will astoundingly seize European car buyers by storm.

References this website: (If your school has access to EBSCO Host articles, you will be able to read this article for free)

Though the path wasn't necessarily easy for this unknown seven-year old company, Hyundai persisted. In 1974, through sheer hard work and perseverance, HMC opened the chapter of its international story with the introduction of the Hyundai Pony at the Turin Motor Show. Initially, exporting automobiles world-wide was seen from different quarters as naive and unrealistic, but Hyundai proved its detractors wrong. In fact, data showed it ...

Solution Summary

Based on research, this solution looks specifically at Kia-Hyundai as an illustrative example in terms of the effects of global expansion. The company's global experiences are evaluated as positive, negative, or mixed. Several barriers and obstacles are also explored, including any legal or political and technological obstacles, cultural or business differences, as well as the problems these differences might have created for the company. The company strategies developed to overcome these obstacles are further detailed based on their effectiveness. One reference is included as a suggestion for further research.