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Hyundai Motor to offer suppliers advance paymentsBy
Published : Aug. 29, 2011 - 19:34
There are about 2,800 Hyundai subcontractors, with the advance payments for their coming auto parts supply to total 1.15 trillion won ($1.06 billion), group officials said Monday.
Many small- and medium-sized companies in Korea badly need cash in September and October because many of them provide a bonus for Chuseok, the Korean thanksgiving holiday which falls on Sept. 11-13.
The three units are Hyundai Motor, Kia Motors and Hyundai Mobis. “Our decision comes as part of efforts to ease the burden of (a certain number of) suppliers suffering from lack of funds,” a spokesman said.
He said the automotive group will continue to actively push for a variety of programs for co-prosperity.
The programs include the introduction of a support system for subcontractors, the quality assurance structure for auto parts, and the outstanding examples of research and development achieved by the suppliers.
Aside from first-tier suppliers, Hyundai plans to expand the benevolent programs to its second-tier and third-tier subcontractors so that they can chalk up stable growth over the long term.
Last year, Hyundai declared “mutual growth with suppliers” and said it will push ahead with a string of steps aimed at strengthening the competitiveness of its subcontractors, most of which are small- and medium-sized enterprises.
An executive of the R&D department of Hyundai-Kia has said, “Our research & development sector has been competitive at a global level, buoyed by multi-dimensional cooperation with and support from our subcontractors.”
He said the Group is considering expanding the suppliers’ participation in the development of new technologies and in the early stages of creating new models, such as planning and designing.
The three Hyundai affiliates have been complying with the fair trading standards in choosing and managing its subcontractors since it signed a relevant agreement in 2008, group spokespeople said.
Last January, Hyundai Motor Group paid its subcontractors a total of 850 billion won in advance before the Lunar New Year that fell on Feb. 3.
By Kim Yon-se (firstname.lastname@example.org)
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