Hyundai teaches Detroit about brand value
Honda did it. Toyota did it. And now Hyundai is doing it: teaching US auto makers some hard lessons in brand value.
From the Wall Street Journal:
A decade ago, Hyundai acquired Kia, a victim of a mid-1990s shakeout in the Korean auto industry. It also established a new quality-control division charged with boosting reliability by emulating Toyota’s vaunted manufacturing methods. To allay lingering concerns over quality, Hyundai put warranties of 10 years or 100,000 miles on vehicles sold in America.
Their campaign began to show results, and the big breakthrough came in 2004, when Hyundai tied Honda for second place in the prestigious J.D. Power & Co. Initial Quality Survey. Also that year, Hyundai completed its first U.S. assembly plant, near Montgomery, Ala.
In 2006, Hyundai topped the J.D. Power initial quality ratings for non-luxury cars, and this year, in January, its first luxury vehicle, the Genesis, was voted car of the year by a panel of journalists at the Detroit Auto Show.
Brand value
A good measure of brand value is how far a brand advances the customer. This is a long-term process. Customers are not quarterly. A 10-year horizon seems about right. A Hyundai built to last 10-years is no longer a “car.” It’s a partner. A friend. A member of the family. That’s where brands belong.
Everyone learns these lessons but Detroit
The forthcoming vehicles from China and India will no doubt emulate the proven success of Japanese and Korean imports. Everyone else seems to learn these lessons but Detroit. Why? Unless US automakers quickly figure out how to build customers into their brands, “Detroit” may come to mean “brand wasteland.”
