Unpacking the ‘black box’ of a Korean big fast follower: Hyundai Motor Company’s engineer-led production system

Abstract

This study focuses on production engineers’ skill formation to explain how the Hyundai Motor Company has succeeded remarkably since the 2000s as a litmus test of the post-catch-up question. Upgrades in Hyundai’s technological capabilities, and in the sophistication of its production system during this period, are described and analysed in relation to a change in corporate governance, monopolised domestic market structure followed by industrial restructuring in the late 1990s, hostile industrial relations and the working of the internal labour market for production engineers. This study concludes that production engineers’ skill-formation process is closely related to Hyundai’s production system, which is distinct from those of foreign automakers. Its excessive automation utilises flexible production technology, which saves on skills on the shop floor; this is the key factor in Hyundai’s considerable growth since the 2000s, given the systematisation and codification of project-based problem-solving capabilities as an engineering skill, and the implementation of a more systematic, performance-based personnel management strategy. The analysis suggests that Hyundai as a litmus test of the post-catch-up question appears to be a mixture of discontinuity and continuity, which is reminiscent of the concepts of ‘POST-catch-up’ versus ‘post-CATCH-UP’.