When Kia Came to Georgia: Southern Transplants and the Growth of America's "Other" Automakers

Abstract

When Kia Came to Georgia:Southern Transplants and the Growth of America's "Other" Automakers Timothy J. Minchin (bio) On February 26, 2010, more than five hundred dignitaries from South Korea and the United States gathered in West Point, Georgia, for the opening of Kia Motors's first North American factory. Built on a 2,200-acre site, the $1.2 billion plant covered 2.4 million square feet and had the capacity to produce 300,000 vehicles a year. As Automotive News—a leading trade publication—observed, the development was "big by any … standard." It created about 3,000 jobs, with almost as many again provided by regional suppliers. The outcome was a massive boost to Troup County, a former textile area in western Georgia that had one of the highest unemployment rates in the state. The factory opening was also a proud moment for Governor George Ervin "Sonny" Perdue III, who been courting Kia since 2003, when he had first visited company officials in South Korea. "Kia's decision to locate its first US manufacturing operation here in Georgia will be a milestone both for this company and our state," he declared at the ceremony.1 Outside observers saw the plant as very significant. Dubbed "a defining moment for the region" by one state-level publication, Kia's arrival also attracted national and international press attention. "An increasing number of Asian carmakers are opening [End Page 889] manufacturing operations in the US," summarized the BBC, "particularly in the South."2 The Kia plant was an important addition to a thriving U.S. economic sector. In 1978 Volkswagen AG established the first foreign-owned assembly plant in the United States, and over subsequent decades the "transplant" sector grew steadily.3 By 2008, these plants employed over 78,000 workers and turned out (in 2005) more than 25 percent of all vehicles made domestically. Attracted by the region's lower wages and weak unions—as well as by generous incentive packages—most transplants were located in the South. While early examples were concentrated in the upper South, by the early twenty-first century many had set up in the Deep South. Alabama alone lured plants from Honda, Hyundai, Mercedes-Benz, and Toyota and thus rapidly emerged as one of the leading automotive states in the country.4 In 2003, meanwhile, Toyota's new $800 million truck assembly facility in San Antonio, Texas, became the most southerly automotive plant in the country. The growth of the southern transplants was part of what Automotive News [End Page 890] termed "a tectonic shift in the North American auto industry.""While the traditional Big 3 slowly deconstruct, transplant automakers are building plants, adding r&d centers and hiring workers," it explained in 2005.5 Southern auto plants, added the New York Times in the same year, "set [the] industry's pace." In 2015, the respected Center for Automotive Research documented that five of the top ten auto-producing states—Alabama, Kentucky, Mississippi, Tennessee, and Texas—were in the South.6 Kia's arrival was an important episode in the industry's development, and it deserves to be explored in its own right. To date, very few studies have focused specifically on the incoming car factories. Firsthand accounts, often by reporters or politicians, provide close-grained insights into particular early transplants yet lack wider context.7 In addition, researchers in management and organizational behavior have explored aspects of the industry, especially efforts by Japanese firms to enact their management techniques in the United States. The globalization strategies of large automakers have also been studied, with some analysis focusing on joint ventures between the Michigan-based Big Three (General Motors, Ford, and Chrysler) and overseas firms. This work has largely occurred in specialist articles and dissertations. Very few studies have focused on the Deep South, and the early stages of the industry's growth in the South have been covered more than have subsequent developments, including the arrival of Korean automakers, which generated some tension between Korean managers and American workers. Detailed scholarly examinations of how and why major players chose to invest in the South [End Page 891] have yet to be written...