More tires for Europe from Hankook Tire Hungary

““A lot has changed in the past three years since Diplomacy and Trade visited Hankook” says Sang Il Lee, managing director of Hankook Tire Hungary ltd. He proudly states that in 2010, the company exceeded the original target by over 10%.

Currently, Hankook Tire Hungary, located at Rácalmás, near Dunaújváros, central Hungary, employs more than 1,700 people, 34 of which are Koreans. Additional Korean staff arrives from time to time for 2-3 months to train people or install machines. The Managing Director finds it important to point out that the number of Korean employees is constantly decreasing: this year, there are five less than in 2010.

Hankook Tire’s European production base was established in 2007 with an investment of some EUR 550 million to significantly cut supply time for clients on this continent compared to production overseas. The factory produces tires for passenger cars and light trucks – 5.9 million last year.

In 2011, the target is 10 million tires with the introduction of the second phase in the plant’s development. That phase is scheduled to be complete by August 2011, doubling the current capacity of 17,000 tires a day. 98% of the tires produced here are sold all over the Europe with the remainder distributed in Hungary.

Starting in 2011, Hankook is the sole – and proud – supplier of tires in the DTM series, the German Touring Car Championships for three years. Hankook Tire Hungary is also an Original Equipment (OE) supplier to several car assembly plants. Last year, they supplied the Hyundai (in the Czech Republic) and Volkswagen (Germany) factories.

Regarding the world economic crisis, the Hungarian plant – due to its fortunate position – did not really feel the impact of sales falling on the European market. It worked on full capacity as the geographically closest supplier of European markets while the Hankook factories in the Far East sent less tires to Europe for about six months before sales picked up again.

“By now, our Korean engineers and our Hungarian staff have learned to cooperate better. Koreans are more relaxed, much more trusting now than at the beginning,” the Managing Director says. Under the Total Productivity Management (TPM) system, “you have to keep order and cleanness around your work place. That applies to workers as well as the management.”

In the Hankook factory, every Tuesday afternoon, employees devote some time to tidy up their work environment. At the beginning, it was unusual but when people saw that the management also showed up, they began to understand the importance of this activity. Sang Il Lee is also there on Tuesday afternoons, along with the Korean managers, to clean working areas in the factory, pick up litter in the parking lot and make the environment cleaner in general.

The Managing Director has been in Hungary for more than three years now. He says he tries to see as many parts of Hungary as possible in his free time. His favorite place to visit is Pecs with its great cultural assets in the south of the country but he also likes Esztergom, Visegrád, Eger and the Balaton region. Koreans are said to be great lovers of Hungarian wine and get to know a lot about them. Sang Il Lee says he likes red wines (especially from the Gere Winery). He also got to like Hungarian food, especially stuffed cabbage.

Hankook Tire Hungary organizes education programs for its employees. One is a post-graduation course for engineers that qualifies them to be ‘tire manufacturing engineer’. The program started last year in the college of nearby Dunaújváros and is paid for by Hankook. There is also an education program for blue-collar workers in a local secondary school and in cooperation with the labor offices. The full-day program of five months, for which people are recruited from the jobless by labor offices, provides the graduates with a government-recognized tire manufacturer certificate and the automatic opportunity to be employed by Hankook.

Hankook Tire Hungary has joined the Central-Danubian Region Economy Development Committee initiated by the Chamber of Commerce of Dunaújváros in which – along with other big companies like Dunaferr, Hamburger Hungaria –, it contributes to the development of the Central Danube region. The group also aims to lobby for better infrastructure and logistics. “We endeavor to create a progressing region that the Hankook factory, its employees and its neighbors can enjoy,” the Managing Director concludes.