THE ROAD TO SUSTAINABILITY HYUNDAI MOTOR COMPANY 2005 Sustainability Report Table of Contents Before You Read

2 Letter from Chairman & CEO In line with our corporate transparent management objectives, the Hyundai Motor Company (hereinafter, HMC) 4 Letter from Vice Chairman & CEO sustainability report is published annually to communicate HMC’s sustainability initiatives as a responsible global corporate citizen to interested parties and associated stakeholders. Based on HMC’s intentions, 6 Hyundai Motor Company Profile activities and performance related to the sustainability aspects affecting our stakeholders and the company, Corporate Philosophy 8 HMC strives to support stakeholders in making sound decisions regarding their involvement with HMC. 10 Interview of President The 2005 sustainability report is written in line with the 2002 Global Reporting Initiative’s (GRI) sustainability Management reporting guidelines. All information presented this year is reported in accordance with the principles of good reporting practice (i.e. relevance, reliability and comparability), however, readers may recognize some 13 Environment Management limitations as there exists a lack of generally accepted reporting standards. As a result, readers, may not be Ethics Management 14 able to accurately compare HMC’s performance to that of other companies without further data, analysis and 16 Global Management interpretation. 32 Quality Management 34 Brand Management The scope of this year’s report is expanded towards a more extensive global coverage of domestic and overseas operations. Detailed information pertaining to the domestic operations, namely HMC Headquarters, domestic manufacturing plants (the Ulsan, Asan and Jeonju plants), the Namyang R&D center and domestic Environmentally Friendly Product service centers including quantitative and qualitative data sets from overseas manufacturing plants (the Turkey 39 Environmentally Friendly Vehicles plant-HAOS, India plant-HMI, and the China plant-BHMC) are presented throughout the report. 42 Fuel Economy & Emissions Qualitative information on the environmental and social aspects of overseas R&D facilities located in the U.S., 48 Recycling Japan and Europe, overseas dealerships and the Alabama manufacturing plant (HMMA) completed in 2005 is also referred to in the report.

Cleaner Production The report includes HMC’s sustainability activities from January 1st, 2004 until June 30th, 2005. 53 Energy / Greenhouse Gas Performance related data in the report are retrieved from data sets gathered from the period encompassing 54 Raw Materials / Waste January 1st, 2004 to December 31st, 2004, HMC’s fiscal year. For the collection of environmental and social 56 VOCs / Air Emissions / Wastewater Discharge data sets, HMC utilized AUTOWAY, a corporate intranet database system used for data collection and classification. In addition, HMC developed the 2005 HMC Sustainability Reporting Guidelines in February 59 Environmental Audits / Environmental Expenditure 2005 to standardize internal data collection and reporting procedures. For the purpose of the report, HMC has adhered to the sustainability reporting guidelines indicated above. Contents from the report are based on Communication with Stakeholders input from stakeholders as well as from HMC’s business performance. The report was written by an internal 61 Customer team of the HMC Environmental Management Strategy Planning Team, Corporate Planning Office of it’s 70 Employee Headquarters. The information presented follows HMC’s internal reporting guidelines and is based on official HMC documents. Contents are reviewed by managers and employees of related departments and approved 76 Supplier by the executive upper management before finalization and publishing. 80 Social Contribution As this is our third sustainability report, it focuses extensively on intents, business processes and structure, and performance, however, future reports will focus more heavily on performance analysis. 86 GRI Index 88 Internal Process Ensuring the Reliability of the Report 89 Independent Assurance Letter from Chairman & CEO 2 3 Hyundai Motor Company / 2005 Sustainability Report

As a responsible corporate citizen, the sustainability management initiatives of HMC include efforts to protect and sustain the current and future environment and to enhance the overall welfare of human life. We have achieved lasting economic success by maintaining continued growth in profits and by providing employment security thus becoming one of the leading economic engines driving the Republic of Korea’s development and rise to prosperity. Perhaps the most visible proof of our success can be seen in the fulfillment of our social responsibilities. We have established an Ethics Charter and have come full circle in realizing the social and ecological responsibilities of our transparent management initiatives. This goes beyond monetary donations to communities in need. We are also giving back to society through proactive efforts and our joint involvement with stakeholders and employees to resolve social issues. As we are aware of the social ramifications of our vehicles and activities, ensuring sustainable mobility through the provision of environmentally compatible vehicles remains the cornerstone of our corporate social responsibility.

Despite the depressed economic state of the domestic market, vehicle exports increased 11.4 percent year-on- year to 1.13 million units through our active expansion into new foreign markets. Since HMC’s first vehicle export in 1976, it has taken an astonishingly short 28 years to surpass the 10 million cumulative total export mark, a new record in the automotive industry. We have enhanced profitability and growth potential by improving product quality and by raising overall brand image. Such achievements have enabled us to be a significant contributor to the advancement of the Korean automobile industry.

The environmental ramifications of the automobile are of paramount importance when considering the future of the automobile. In these changing economic times, HMC’s foremost sustainability issue revolves around the dual issues of developing an automobile which is both profitable and environmentally sustainable. Today, achieving sustainability incorporates the balancing of economic, social and environment issues not only for HMC, but for the rest of the automotive industry. From this perspective, we have established effective policies and strategies to actively tackle the environmental issues confronting us. At the same time, we are drawing on the input of stakeholders in the overall management practice that we at HMC undertake.

Finally, HMC will not compromise the quality of the environment bequeathed to future generations merely for the sake of increasing current consumption. The foundation for the future is linked inextricably to the sustainable efforts of present stakeholders. As Korea’s most visible and best known multinational, we aim to perform future oriented sustainability management practice that takes intergenerational equality into consideration; we look to build upon existing trust-based relationships with stakeholders as a model automotive company; and we strive to become a global company that sets world class standards to be followed. Through our continuing efforts, we request your continuous participation and suggestions regarding our everyday activities.

October 2005

Mong-koo Chung Chairman & CEO Letter from Vice Chairman & CEO 4 5 Hyundai Motor Company / 2005 Sustainability Report

cleaner forms of energy take center stage, HMC has concentrated its efforts on the development of sustainable fuel technologies and on efforts to commercialize environmentally compatible vehicles based on Hybrid Electric Vehicle technology and Fuel Cell Electric Vehicle technology which promise to help reduce

CO2 emissions.

If environment management, a practice which fulfills social responsibility through cleaner production and environmentally friendly vehicles is action-oriented, then the implementation of ethics management initiatives, which promotes ethical awareness and conduct among our employees provides a moral foundation to overcome the difficulties in implementing sustainability management particularly when confronting a harsh business environment or a dilemma in the course of decision making. Since the implementation of its Ethics Charter in 2001, HMC has established a broad set of ethical policies and organizations; ethics management practice guidelines, ethics charter for the procurement office, employee ethics guidelines, ethics committee, cyber audit office and compliance program for fair trade.

One of our key goals is to provide a balance between economic growth, social responsibility and environmental stewardship for the future. As a responsible corporate citizen that has always been at the forefront of environmental protection and national economic growth, HMC is actively involved in various philanthropic programs that contribute to social welfare. HMC's programs are designed to promote education, academic research, the arts, sports, international exchanges, and environmental protection. In addition, we actively support and encourage our employees to volunteer in the assistance of natural disaster victims and the socially disadvantaged. Recognizing that long-term support is as important as one-time donations or volunteer work, we are changing our volunteer programs so that they can provide more As the undisputed leader of the domestic automotive industry and the flagship corporation of Korea, HMC practical assistance in helping people overcome hardships. As the monetary donations and provision of relief has established manufacturing plants, research and development facilities and regional corporate offices in supplies represent only one dimension of social contributions, HMC has undertaken a role to improve the key overseas markets. Perhaps the most visible proof of our success has been our rapid growth into a global quality of life of all communities through the operation of wide ranging social partnership programs in company exporting over 1.1 million vehicles annually to over 190 countries. But as a global corporate citizen, cooperation with NGOs. we realize the need to fulfill social responsibilities. As a result, HMC has actively engaged in key areas of sustainability management practice, such as environment management, ethics management and social As a global corporate citizen, one of our principle tasks is to create a sustainable balance in our activities contribution initiatives. reflecting our economic, environmental and social responsibilities. With this third edition of the HMC sustainability report, HMC has done its best to convey our intentions, expectations, achievements and Respecting human values and fulfilling social responsibilities are two aspects of our corporate environmental performance as transparently as possible. Finally, I would like to pledge once again that HMC will continue to philosophy. As a global automobile manufacturer, our activities span the entire value chain of industrial be a leading automaker that guides society toward a sustainable future by ensuring the prosperity lives of the activity from R&D and procurement to production, distribution, marketing and after-sales service. And with current and future generations to come. growing environmental awareness centering largely on the emissions of greenhouse gases and more specifically CO2 emissions, HMC is taking various proactive steps to provide environmentally compatible October 2005 solutions in step with our peers in the automotive industry. As an initial measure towards preventing global warming, HMC is actively complying with domestic and international environmental regulations, voluntary agreements and conventions. In addition, HMC has begun to aggressively participate in multilateral efforts to curb greenhouse gases by working closely together with governmental offices, international agencies and non-governmental organizations. As energy conservation measures and the expansion of the usage of

Dong-jin Kim, Ph.D. Vice Chairman & CEO 6 7 Hyundai Motor Company / 2005 Sustainability Report

Hyundai Motor Company Profile

Established in 1967, HMC launched its “Pony” model in 1976, which was the first Korean-made automobile to be exported. Since the Pony, HMC has continued to expand its export volume and overseas market to North America, Europe, China, Japan and other parts of the world. In 1984, HMC exported 500 thousand automobiles; last year we exported 1 million automobiles and received the “Ten Billion Dollar Export Award” from the Korean government. In 1991, HMC built Korea’s first engine and transmission parts. By doing so, we greatly contributed to the Korean auto industry by localizing the production of key components. HMC produces passenger vehicles, light trucks, dump trucks, commercial buses, vans and other specialty vehicles including fire engines, petrol cars, ambulances and armored vehicles. HMC has long been a key player in Korea’s economic miracle and has become a symbolic leader in the Korean economy. In order to assure our business competitiveness, we focus our efforts not only on quality and technological advancement, but also on the enhancement of our corporate image. As such, the preservation of our natural environment is a critical issue for our business, leading us to make substantial investments in improving the environmental performance of our vehicles.

Corporate Profile Corporate History

Hyundai Motor Company 1967 - Establishment of Hyundai Motor Company 1999 - Naming of Hyundai Motor as official sponsor 2003 - Announcement of OLV, concept car 2004 - Launch of new concept car HCD-8 TM 1976 - First export of Hyundai Pony to Guatemala of 2002 FIFA World Cup - First development of ultra high-pressure hydrogen - Sponsorship with Wheelchairs Funds(donates Headquarters: Seoul, Republic of Korea (231, Yangjae-Dong, Seocho-Gu) and El Salvador 2000 - Official supporter of Euro 2000 tank system for fuel cell electric vehicles wheelchairs) Industry Sector: Manufacturing 1983 - Establishment of Hyundai Auto Canada Inc. - Introduction of Hyundai HCD-V concept car - Commencement of construction of design center - Hyundai unveils the concept car E3(E-Cubed) at 2004 1984 - Completion of the first Korean proving ground - Introduction of Korea’s first passenger car diesel and proving ground in North America Geneva Motor Show Major Product: Automobiles in Ulsan Plant engine - Official partner of EURO 2004 - Hyundai Elantra & XG receive good marks(FSST) 1985 - Establishment of the Hyundai Motor America - Participation in the California Fuel Cell Partnership - Formally proclaimed the first auto company to from safety programs (NCAP) Production: 1,677,818 units per year (CKD Excluded) 1991 - Hyundai becomes the first in Korea to develop - Launch of Korea’s first automobile business group implement Global Environment Management - Hyundai opens R&D center for next generation Sales: 27,472 billion Korean Won the engine (Alpha Engine) independently - Development of Korea’s first heavy-duty truck engine - Supply of environment-friendly Santa Fe Electric vehicles at Seoul National University - Development of Electric Vehicles - Development of Korea’s first fuel cell electric vehicle vehicle to Athens Olympic Games - ‘Hyundai Football World Championship’ 40 countries Assets: 24,700 billion Korean Won 1992 - The first in Korea to develop a concept car HCD-1 2001 - Honoring of Chairman Mong-koo Chung with - Testing of Fuel Cell Electric Vehicles for commercial participate 1993 - Development of the HCD-II Automotive Hall of Fame’s DSC use in partnership with UTC Fuel Cells begins - Hyundai Motor passes major milestone with export Net Income: 1,804 billion Korean Won 1994 - Development of Hydrogen Powered - Introduction of Hyundai’s concept car HCD-VI - Begins construction of the Auto industry’s first of 10 millionth vehicle Chairman & CEO: Mong-koo Chung Fuel Cell Electric Vehicles - Introduction of prototype Hyundai Santa Environmental Technology Research Center - HMC establishes joint venture commercial vehicle - Development of solar car Fe fuel cell vehicle - Sponsorship to Wheelchairs Funds of production facility in China Date of Establishment: Dec. 29, 1967 - Breaking of the 1 million units production mark - Honoring of Hyundai Motor America with Hyundai Motor Group - Hyundai (Tucson) wins ‘Good Design’ Award in Japan for the year J.D. Power Chairman Award - First-rate in consumer’s satisfaction survey - Hyundai ranks high in ‘Strategic Vision's’ 2004 Total * Production: production total from domestic (Ulsan/Asan/Jeonju) and overseas manufacturing plants (India/Turkey/China) in 2004 1995 - Development of the HCD-III - Honoring of Hyundai Santa Fe with first place in of Korea Industry for 10 successive years Value * Sales, Assets and Net income: Hyundai Motor’s Independent Financial Standard for fiscal year 2004 - Unveiling of the energy efficient Gas Beta Engine AutoPacific satisfaction survey - Commencement of construction of R&D - Development of the Tucson Fuel Cell Electric Vehicle - Completion of the commercial vehicle factory 2002 - Completion of the Hyundai-Kia California Design & Center Europe - BusinessWeek names Chairman Mong-koo 1996 - Completion of the NamYang Research & Technical center - Sonata and Sante Fe chosen as number 1 and 2 in Chung among the best CEOs of 2004 Development Center - Introduction of Hyundai HCD-7 concept car J.D. Power’s consumer satisfaction study 2005 - Unveiling of Grandeur(Azera) and HED-1 concept car - Breaking of the 10 million total units mark for production - Launch of joint venture between Hyundai Motor and - Introduction of Hyundai NEOS II concept car at Geneva Motor Show 1997 - Development of the Epsilon Engine Beijing Automotive Industry Holding Company in - Announcement of new environmentally friendly - Launching of new global brand management strategy - Completion of the Turkey plant China diesel engine technology - $60 million US California based proving ground opened 1998 - Development of aluminum-block V-6 Delta engine - Consumer Report chooses Hyundai as number - Official sponsor of 2004 FIFA World Youth - HND-1 (Portico), the new concept unveiled at - Development of European concept car Hyundai Euro-I 2 along with Honda in a reliability study Championship (UAE) Chicago Auto Show - Development of Hyundai’s second generation solar car - Hyundai Motor Company’s Sonata receives highly - Yearly exports break 1 million units barrier - Hyundai unveils first Hydrogen-Powered Tucson SUV - Completion of Indian plant favorable reviews from J.D. Power for its performance at Los Angeles Auto Show - Acquisition of Kia Motors and design - Car book 2005 names five Hyundai models a ‘Best Bet’ - Hyundai Motor Company receives gold level PBEC - Chairman Mong-koo Chung declares vision Environmental Award ‘Innovation for Humanity’ - Completion of Alabama Plant 8 9 Hyundai Motor Company / 2005 Sustainability Report

Corporate Philosophy

The spirit of creative challenge, which has paved the way for its growth, is the core value at HMC. HMC aims for creativity and innovation to actively respond to changes in the business environment. Based on this philosophy, HMC aims to provide automobiles and related support services to enrich the overall quality of life for both domestic and overseas stakeholders. In addition, HMC has taken the necessary steps forward along with shareholders, customers, employees, suppliers, dealers and local communities, all on the basis of mutual trust. Interview of President 10 11 Hyundai Motor Company / 2005 Sustainability Report

Jae-kook Choi Interview President

Q: In order for a corporation to attain higher sustainability management standards and to keep the process moving forward, it must see continual improvement in its bottom line. From a financial growth standpoint, how did HMC perform in 2004? A: HMC recorded total sales of 27.5 trillion Korean won based on worldwide sales of 1.67 million units, which resulted in 1.8 trillion Korean Won in net-income. Although the domestic market experienced a contraction in “We will continuously strive sales to 550 thousand units, down 12.6 percent year-on-year, HMC’s market share rose by 2.6 percent from the previous year to maintain a 50.3 percent total market share on the back of strong new vehicle sales most to further sustainability notably the all-new Sonata and Tucson, vehicle exports totaled 1.12 million units for 2004, an 11.1 percent increase management with continued year-on-year on the strength of improved quality and brand value. Despite the unfavorable market conditions of development based on 2004, HMC posted financial gains across the board supported by strong employee effort and on the heels of customer-based management designed to elevate customer satisfaction levels, social partnerships and enterprising and the creative charitable initiatives. Hyundai Spirit.” Q: With regard to environment management, what were the most important issues confronting HMC in 2004? A: HMC has been continuing the development of environmentally friendly vehicle technologies and on establishing a more environmentally benign manufacturing system. Working in partnership with the Ministry of Q: What are some of the special characteristics of this year’s sustainability report? Environment, HMC has been participating in a long-term fleet field testing 50 Getz Hybrid Electric Vehicles in the A: This year’s edition of HMC’s sustainability report, the third of its kind, is composed of qualitative and Seoul metropolitan area. The data obtained from the project will be applied to improve reliability and quantitative data represented throughout the value-chain of environment management initiatives encompassing performance in the preparation for mass-production of HEVs. Furthermore, with the outstanding performance R&D, procurement, production, sales and after-service with emphasis on employee ethics, transparent improvements in the Tuscon Fuel Cell Electric Vehicle over the first generation SanteFe FCEV, HMC is presently management and social partnership activities. For the first time, the report includes quantitative and qualitative participating in the U.S. Department of Energy demonstration project on FCEVs and hydrogen re-fueling data sets from HMC’s overseas manufacturing plants, Hyundai Motor India, Hyundai Assan Otmotiv Sanayi and infrastructure in partnership with other leading automotive and energy companies. And in the pursuit of cleaner Beijing Hyundai Motor Co. Information regarding HMC’s quality management, brand management and global manufacturing standards, HMC has been extending environment management support to its suppliers through management initiatives are included for the first time ever to enhance the readability of this year’s issue in an active participation alongside the Korea National Cleaner Production Center, which operates under the auspices attempt to reach out to a wider network aside from the primary investors, stockholders and other stakeholders. of the Korea Institute of Industrial Technology. since June 2003. Also, the report has undergone reporting assurance by an independent auditing firm as in past years in order to maximize transparency and credibility. Q: Would you please inform us in greater detail of HMC’s role in expanding social partnerships and charitable donations? Q: How has the role of stakeholders and communication been addressed in this year’s sustainability A: HMC has supported a wide variety of charitable causes donating more than 7 billion Korean Won in 2004 to report? domestic social welfare organizations which serve the underprivileged and by providing volunteer services and A: Last year’s report, which was presented in Korean and English, was distributed to over 1,500 organizations and one billion Korean Won worth of supplies to underprivileged groups. Aside from these donations, HMC opinion leaders representing domestic and international government organizations, business partners, NGOs, media, employees initiated and actively participated in blood donation campaigns, fund-raising bazaars and rice-sharing academic and financial institutions. This report, one of several reports distributed along with the annual report and events. Starting in 2005, HMC has been placing greater emphasis on social contributions and partnership the corporate brochure, explains management and financial activities with the aim of improving the channels of activities through its 107 employee based social-service voluntary groups and has been working together with communication with stakeholders. This year’s edition is special in that it provides detailed qualitative and stakeholders to support 22 external social-welfare organizations. HMC aims to continue widening the avenues of quantitative information regarding HMC’s environment management and social partnerships thus helping play a key communication to strengthen trust and promote interactive partnerships encompassing all members of society. role in meeting the information needs of various stakeholders while at the same time serving as a platform to As a requisite to furthering this goal, HMC plans on continuing to carry out social welfare activities and programs educate employees and broaden their understanding of key sustainability issues. needed most by communities where we conduct our business. 13 Hyundai Motor Company / 2005 Sustainability Report

Environment Management HMC announced its Environmental Philosophy and Global Environmental Policy in 2003. Since then HMC has arranged key ideas for systematic environment management. In addition, HMC has also established and is implementing environment management strategy within the automobile industry’s value-chain encompassing R&D, purchasing, production, logistics, marketing & sales and A/S.

■ Environment Environmental Philosophy & Policy Management Strategy The Chairman and CEO, Mong-koo Chung outlined HMC’s Environmental Philosophy & Policy in June 2003. The initiatives called for HMC to respond diligently to global environmental issues and to transform itself into a model sustainable company. The accomplishment demonstrated HMC’s desire to fulfill corporate social responsibility and it is expected Management to enhance the confidence of stakeholders.

Harnessing technological innovation and conserving resources to make safer and more environmentally friendly vehicles has always been at the center of HMC’s commitment to sustainability. HMC commits to excel further to build a Environmental Philosophy sustainable future between humans and cars. Mobility is now a necessity so the automobile industry has a major impact on our lives. It is clear therefore that HMC needs to meet its economic, environment, and social responsibilities as a For the harmony of humankind, the environment and society, Hyundai Motor Company respects human value corporate citizen. This is the key to our sustainable management initiative. and fulfills corporate social responsibility through environment preservation.

Global Environmental Policy Environmental Committee Based on corporate citizenship, Hyundai Motor Company For successful implementation of the environmental is dedicated to respecting human value and preserving the strategy, HMC organized a corporate-level global environment. We, thereby proclaim this Global environmental committee. The committee, chaired Environmental Policy for sustainable society. by the Chairman & CEO, is comprised of three Recognize the environment as a core element of independent committees; the Environmental business and create corporate value by proactively Product Committee, the Environmental Production pursuing environment management. Committee and the Environmental Management Promote the development and distribution of Committee. The committees work together with the environmentally friendly products. support of 12 subcommittees to establish corporate-wide and department-specific targets and Dedicate to reducing pollutants and to preserving resources and energy for sustainable use at all stages of action plans based on our environmental policy. our products’ life cycle, from development to production, sales, use and disposal. Environmental Committee Endeavor to provide all employees with environmental training programs, support suppliers in environment Environmental Environmental Environmental Production Product Management management and contribute to public welfare. Committee Committee Committee

Comply with all international and national environmental Fuel efficiency Production plant Marketing/Sales regulations and agreements. Continue to improve subcommittee subcommittee subcommittee environmental management and publicly disclose our Emission subcommittee Production technology A/S subcommittee performance. subcommittee Recycling subcommittee Environmental purchasing Environmental accounting subcommittee subcommittee Next generation vehicle Environmental logistics Environmental communication subcommittee subcommittee subcommittee

*Secretariat : Environmental Management Strategy Planning Team Management Environmentally Friendly Product Cleaner Production Communication with Stakeholders 14 15 Hyundai Motor Company / 2005 Sustainability Report

Ethics Management Board of Directors External audits along with HMC’s Board of Directors assist to keep transparent management policies in check Ethics Management Program HMC organized the Board of Directors for the as HMC is moving progressively closer toward its commitment of ethical and transparent management. • Employee Ethical Code of Conduct Guidelines purpose of management transparency. In addition, To realize corporate social responsibility based on global corporate citizenship, HMC has adopted various ethics In June 2005, HMC added new ethics regulations to its HMC’s Board of Directors is responsible for management programs helping to raise employees’ ethical awareness and to support the initiation of ethically existing ethics charter and mapped out guidelines by which independent external audits for the purpose of all employees are expected to adhere to in all aspects of sound business decisions. In addition, in line with this objective, HMC enforces independent external audits and accounting assurance. business practice. The guidelines specify the does and pursues ethics management through the development of systems. doesnt’ of employee on the job and off the job behavior including outlining employee job analysis. HMC has ■ Operation of Board of Directors ensured user friendliness and practical applicability of the HMC organized the Board of Directors in accordance new guidelines. Ethics Charter • Contributions to our country and society to the Korean Security Exchange Act for the purpose We will contribute to our country’ s economic growth of management transparency. The Board of Our company, Hyundai Motor Company, is reborn as an • Compliance Program for Fair Trade through continuous employment creation and faithful Directors consists of 3 executive directors and 4 automobile group unique in our country based on national HMC is working toward a more transparent management tax payment. non-executive directors representing all fields of the expectation and concerns and is charged with a mission of of its business. Through the operation of a Compliance We will fully comply with all environment related laws and automotive industry. In 2004, a total of 12 Board of paramount importance to lead national economic growth in Program, HMC aims to better conform to regulations and regulations to lead the way in environment protection the 21st century by strengthening the competitiveness of the laws, and to minimize economic losses. In line with its Directors meetings were held; 4 were regularly and make contributions to our society through cultural automobile industry, a key industry of our country, to a promotion and support of transparent management and scheduled meetings while the remaining 8 were and welfare projects. world class level. fair trade compliance, HMC enforces employees to extra-session meetings. • Promotion of customer and investors’ interest undertake training on fair trade and focuses heavily on We will promote customer and investors’ rights and improving ethics management policies. ■ Profile of Board of Directors interests with the best products and service, keep (December 31, 2004) • Cyber Audit Office confidence with customer information, and fulfill Category Title Name Remark commitments with customers. The Cyber Audit Office is one part of HMC’s ethics Executive Chairman and Mong-koo Chung Chairman and CEO We will manage and increase the assets of investors by management initiatives. HMC’s ethics charter and Directors CEO of Hyundai·Kia Motors improving the financial structure by maximizing the business principles are available directly on the Internet, Vice Chairman Dong-jin Kim Vice Chairman and efficiency of business management. giving employees clear standards to help make better and CEO CEO of Hyundai ethical workplace decisions. Since April 2004, HMC has Motor Company • Human respect and talent merit been operating a cyber reporting online center to report President Cheon-soo Jeon President of Hyundai We respect every employee as an independent character any illegal or unfair business practices and suggestions. Motor Company to form an advanced organizational culture based on All reports receive feedback from management and Non-executive Director Kwang-nyun Kim Member of the Audit mutual reliance and understanding and we will do our reporting employees are informed directly of the results. Directors Committee best to prevent sexual harassment from occurring. *Ethics Management website : http://audit.hyundai-motor.com Director Dong-gee Kim Member of the Audit We strive for the cultivation of all employee’s ethic Committee awareness and provide systematic support long term to Director Byung-il Park Member of the Audit train them as flexible and creative individuals. Committee Director Masao Miyamoto • Establishment of partner relations with suppliers We actively assist our suppliers through technical ■ Board of Director Committees support and management directions to further the (December 31, 2004) synergetic effects and to allow them to obtain Name of the Number of Director Responsibilities international competitiveness during the long haul. Committee Executive Non-executive Directors Directors We deal with suppliers in a fair manner, never making Board of Director Non-executive any unfair demands by taking advantage of our Nomination Directors prominent position. Committee22 Nomination of external directors • Settlement of transparent management Accounting and Audit Committee - 3 Management We will deal with all businesses using transparent Audit standards and will settle the fair trade practice by *Corporate Governance website : http://ir.hyundai-motor.com keeping fair transactions securing the interests of each party with transparent terms and conditions with all business partners including customers and suppliers. Also, we will drive out all requests from interested persons which may be adverse to fair practice in connection with posts. Management Environmentally Friendly Product Cleaner Production Communication with Stakeholders 16 17 Hyundai Motor Company / 2005 Sustainability Report

Global Management HMC aims to establish international positioning through the implementation of global management initiatives. From the first exports to Ecuador in 1976 to the export of the Pony Excel to the American market in the 1980’s, HMC has continued to stir consumer interest and excitement. Since 1997, HMC has established overseas manufacturing plants in fast growing foreign markets. With the establishment of HAOS in 1997, HMI in 1998, BHMC in 2002 and most recently HMMA in 2005, HMC has diversified its operations and has taken aim on the BusinessWeek CEO of the year 2004 global market. BusinessWeek, a U.S. magazine, named Chairman and CEO Mong-koo Chung as one of the best CEOs in the corporate world for 2004, recognizing his leadership for turning around HMC in automotive markets in the U.S. and other regions. BusinessWeek awarded

■ Global Network 17 CEOs of which Chairman Chung was the only selected from Asia.

Since accepting the position as Chairman & CEO of Hyundai Motor Company in 1999, Chairman Chung has concentrated heavily on raising company standards to a world-class level by introducing Six Sigma quality management pioneered by GE of the United States and adapting them to HMC’s unique engineering and manufacturing environment. Chairman Chung’s quarter century of experience in the automotive industry has helped him develop his “Quality is the Top Priority” management policy.

Chairman Chung’s decisions to expand investments in overseas operations particularly in the newly industrializing countries of China, Turkey and India are paving the way for HMC’s growth in the 21st century. Investments of a comparable scale are being made in the United States and Europe.

BusinessWeek: A business magazine published by McGraw-Hill Group Management Environmentally Friendly Product Cleaner Production Communication with Stakeholders 18 19 Hyundai Motor Company / 2005 Sustainability Report Global Management

Korea

Ulsan Plant The Ulsan manufacturing plant, consisting of five designed a wide variety of facilities for the comfort independent manufacturing facilities and covering and convenience of our employees, as we believe in 1,215 acres of land, has an annual manufacturing creating an optimal working environment for them, capacity of 1.53 million vehicles. Approximately 34 as they create excellence for our customers. thousand employees work here. This plant has its own exclusive pier, which can accommodate three Jeonju Plant ships of 42 thousand tons each. It is one of the Our Jeonju manufacturing plant, situated on 243 biggest auto manufacturing plants in the world and acres in the Korean heartland, specializes in plays a core role in the Korean automobile industry. manufacturing buses, 2.5-ton and heavier trucks and special purpose vehicles. This plant has an Asan Plant annual manufacturing capacity of 60 thousand The Asan manufacturing plant, focused on vehicles, and is one of the biggest commercial manufacturing passenger cars for export, consists of vehicle manufacturing plants in the world. This plant a stamping shop, a highly automated body line, strives to develop new eco-friendly products. paint shop and final trim and assembly line as well The plant has various cutting-edge equipment as a foundry and an engine manufacturing facility. required to independently develop about 100 It stands on a 445 acre site and has an annual different models of commercial vehicles. manufacturing capacity of 290 thousand vehicles. This plant was built with the philosophy of creating the safest and most eco-friendly work environment possible. We have paid careful attention to environmental protection at this plant. We have also

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1 Ulsan Plant 2 Asan Plant 3 Jeonju Plant

Ulsan Plant Asan Plant Jeonju Plant Total plant site area of 5,000,000㎡ Total plant site area of 1,811,000㎡ Total plant site area of 990,000㎡ Total floor space : 2,310,000㎡ Total floor space: 429,000㎡ Total floor space: 363,000㎡ Production capacity : 1,530,000 (units/year) Production capacity: 290,000 (units/year) Production capacity: 60,000 (units/year) Vehicles produced : Accent, Getz, Santa Fe, Vehicles produced: Sonata, Grandeur (Azera) Vehicles produced: Medium and large size Centennenial, Tucson, Elantra, Coupe, Matrix, H-1, Address : 123 Kumsong-ri, Inju-myun, Asan-si, buses, medium and large size trucks, Ulsan manufacturing plant special duty cars Trajet, H100 Truck, H-1 Truck, Terracan Chungchungnam-do, Korea Address : 800 Yongam-ri, Bongdong-eup, Address : 700 Yangjong-dong, Buk-gu, Ulsan, Korea Wanju-gun, Jeollabuk-do, Korea Management Environmentally Friendly Product Cleaner Production Communication with Stakeholders 20 21 Hyundai Motor Company / 2005 Sustainability Report Global Management

Turkey

Hyundai Assan Otomotiv Sanayi Ve Ticaret A.S, HAOS In September 1995, HMC established HAOS in HAOS initiated the Q-car 2004 campaign with Izmit, Turkey as a joint venture with the KIBAR employees in an effort to manufacture world-class group. Located 2 hours from Istanbul and within a quality vehicles. To improve vehicle quality 20 km radius of other major automobile standards, HAOS has implemented state of the art manufacturing plants, the area was specifically equipment, technology, and facilities used in HMC targeted and selected for its close proximity to Korea. Furthermore, all vehicles are fully tested via trading infrastructure and to enhance the overall its proving ground before delivery. synergistic effects. With a total size of 991,740m2 HAOS implements a quality control reporting system including the largest proving ground in Turkey, for all models and a double-check system to ensure HAOS has an annual production capacity of 60 quality assurance in all of its processes. To improve thousand units. In addition, Korean suppliers in employee morale and productivity, HAOS selects Izmit along with Turkish suppliers are working ‘Employees of the Month’ and ‘Employees of the toward product enhancement and innovation Year’. developments. Assan plant, HAOS Plant Profile Hyundai Assan Otomotive Sanayi Total plant site area of 1,000,000㎡ Through the implementation of various strategies to Address : Sehit Mehmet Fatih Ongul Sk. Production capacity: 60,000 (units/year) further production and sales initiatives in 2002, No: 2, 34742 Kozyatagi, Istanbul, Turkey Vehicles produced: Accent, H-1, H100 HAOS has now achieved economic competitiveness. Unlike other Complete Knock Down plants (CKD), HAOS is independent and encompasses its own engine production capability. Prime Minister of Turkey to Ulsan Plant Provided the Centennial for Turkish Protocol Service Delivered Patrol Cars to Istanbul City Police In addition, HAOS has improved logistics systems to On February 2004, Turkish Prime Minister Recep Tayyip HMC provided a Centennial for diplomatic purposes to the Department reduce environmental impacts. Erdogan met with Chairman and CEO Mong-koo Chung Turkish government in June 2004. Acclaimed for its brand value in the Turkish market, HAOS at the Ulsan plant to develop the Korean Turkish delivered an order of 100 Accents patrol cars to the automobile relationship. The purpose of the visit was to Istanbul City Police Department in 2004 reinforce Korean Turkish relations and to discuss ways for HAOS to improve competitiveness in the local market.

Provided the Centennial for Turkish protocol service Accent supplied to Turkish Istanbul police office

Visit of the Prime Minister of Turkey to Ulsan Plant Management Environmentally Friendly Product Cleaner Production Communication with Stakeholders 22 23 Hyundai Motor Company / 2005 Sustainability Report Global Management

Even as a foreign invested company, HMI is India strengthening its image as a local automotive Getz, India’s Best Car for 2005 manufacturer. Over 70% of the parts used in HMI HMI’s Getz was selected as CNBC’s Best Car in India for vehicles are supplied by Indian auto-parts 2005, and was also chosen by Business Standard as the Hyundai Motor India, HMI companies. Where as other foreign automobile Best Car for 2005 in December 2004. companies continue to supply the Indian market India is a central part of the BRICs (Brazil, Russia, In the 3 years since its inception in September 1998, with old out-dated models, HMI’s line-up includes India and China), developing countries that will play HMI has become the 2nd top selling company in India. new and existing models that are currently being a key role as the key global economic centers of the In 1998, a local joint venture automotive company sold in the Korean market. HMI operates Hyundai future. Specifically, HMI has been targeted as one held an 80% market share of the compact class. Motor Plaza as a sales and A/S dealer center. of the key bases of HMC’s globalization efforts in the On the back of aggressive marketing strategies, HMI’s success in India is a direct result of Hyundai Indian, South West Asian and Central and South HMI’s Santro overtook the local automotive company Motor Plaza’s extensive education and service American markets. as the top seller in the compact category in 2001 efforts, its analysis of consumer preferences and its and continues to maintain this status through 2005. ongoing commitment to marketing strategies. HMI is located in Chennai, one of four major During the 5 year period from its inception to industrial centers in India. The positioning of HMI in December 2003, HMI has sold over 500 thousand infrastructure laden Chennai along with its close vehicles and continues to garner accolades for it proximity to supplier bases have allowed for HMC’s remarkable progress in the Indian market. Ensuring Best Quality smooth transition into the Indian automotive market. In February 2005, Chairman and CEO Mong-koo Chung visited affiliated automobile suppliers located in the Indian In addition, Chennai’s geographical positioning as a market. The Chairman inspected for quality assurance, Elantra, The Best Value for Money Car port city along with international airport facilities and encouraged for continual improvements in product The Elantra was chosen in India as The Best Value for allow for cost efficiency and environmentally friendly innovation and quality. Money Car in 2005 by CNBC. logistics.

Plant Profile Hyundai Motor India Address : A-30, Mohan Co-Operative Industrial Area, Phase-1 Mathura Road, New Delhi 110-044, India Total plant site area of 2,148,000㎡ Production capacity : 250,000 (units/year) Vehicles produced : Santro, Elantra, Sonata

Chennai Plant, HMI

Chairman and CEO Mong-koo Chung assuring product quality in the field Management Environmentally Friendly Product Cleaner Production Communication with Stakeholders 24 25 Hyundai Motor Company / 2005 Sustainability Report Global Management

China Improving Inter Korea·China Relations Civilian Diplomatic Cooperation in Shanghai, China Mr. Jia Qinglin, the chairman of the National Committee Chairman and CEO Mong-koo Chung is leading the way of the Chinese People’s Political Consultative Conference in developing business opportunities in Shanghai for Beijing Hyundai Motor Company, BHMC (CPPCC), visited HMC’s Ulsan plant in August 2004 to HMC and other Korean companies. Shanghai historically discuss the future of China’s automobile industry with important to the Korean people as it was the location of BHMC began operations in December 2002 with the Chairman and CEO Mong-koo Chung. Mr. Jia Qinglin our exiled Korean Government and symbolized our drive production of the new EF Sonata. With the opening, commended HMC for its progress and described HMC’s towards independence during the Japanese occupation BHMC has begun to receive recognition throughout economic role in Korea as being vital. He used the term of Korea from 1910-1945. Shanghai has been preparing the globe. The new EF Sonata became an instant ‘Hyundai miracle’ to describe the importance of HMC to to undergo redevelopment initiatives in areas where the hit in the Chinese market as consumers have taken the Korean economy and hoped that HMC’s success exiled Korean Government was located. To protect the would translate into further development and success in area of concern, Chairman Chung has lobbied to secure notice of HMC’s improved quality, performance and the Chinese automotive industry. The success of HMC’s redevelopment contracts for Korean companies. sleek design. BHMC has shown such remarkable joint venture in BHMC has resulted not only in economic In addition, lobbying efforts are viewed as a tool to utilize progress in a short period of time that its success development but in improved inter Korea·China intensive human networks within overseas and has been dubbed as ‘Hyundai Speed.’ relations. international business operations.

BHMC sold over 50 thousand of the new EF Sonata in its first year of production, garnering a 10% market share of the entry mid-size class in China. In a mere 6 months, the Elantra, modified to meet the Assembly line in Beijing Plant demands of local consumers became an instant success as well, ranking number one in total sales in its class. As the top foreign automobile manufacturer Plant Profile in terms of sales in the Chinese market, HMC is Beijing Hyundai Motor Company Address : Room 601,Millennium Tower No.38 pushing forward to sustain its lofty status. Xiaoyun Road,Chaoyang District, Beijing China Total plant site area of 670,000㎡ Production capacity : 150,000 (units/year) Vehicles produced : Sonata, Elantra, Tucson Mr. Jia Qinglin, the chairman of the CPPCC, visited in Ulsan plant Chairman and CEO Mong-koo Chung, meeting with Zheng Han, mayor of Shanghai city

Beijing Plant, BHMC

The small park inside the plant used as leisure area for employees Management Environmentally Friendly Product Cleaner Production Communication with Stakeholders 26 27 Hyundai Motor Company / 2005 Sustainability Report Global Management

Jae-man Noh Interview Senior Executive Vice President, BHMC

2 3 Q: How do Chinese people perceive Hyundai Motor Company? A: A Korean trend have been heating the Chinese mainland. If you turn on the TV at night today, you can catch up to seven channels playing Korean drama programs out of the forty channels. The most important effect that the Korean trend has given is people’s new understanding about “the People’s Republic of Korea”. It’s true that the Korean trend has given influence to the marketing of HMC, however minute overseas marketing strategies might have born the fruits. Since entering the Chinese mainland with the release of the new EF Sonata in Dec., 2002, BHMC which is a joint venture of HMC and a Chinese party has settled down as a professional

1 4 automobile enterprise and has achieved top monthly sale ranking for all models in just two years time. Just as in the domestic market, the results derived from efforts to enhance brand image has made quality and local production prominent. Chinese people wish that the growth of HMC and the Korean economy might have good effects on the Chinese economy. In August 2004 chairman Qinglin Jia who is forth in line in the communist party visited the Ulsan plant of HMC and met with Chairman and CEO Mong-koo Chung as this elaborates the wish of the Chinese people.

Q: What is BHMC doing for social engagement? A: China is growing very fast with the big events such as gaining membership into WTO, the 2008 Olympic Games to be held in Beijing, the World Exhibition in 2010 and so on. Now it has become impossible to talk about the world economy without China. China occupies 1/15 of total global land area, which is third largest in the world and a 1.3 billion population as well as complicated and various languages and cultures. To meet the various demands of such a great number of Chinese people, BHMC is promoting various contributory activities to society. When SARS(Severe Acute Respiratory Syndrome) broke out in April, 2003, BHMC donated vehicles to Beijing 5 SARS Eradication Measures Headquarters, performed thorough sanitary control inside the plant, and sent

1. Public service for the underprivileged employees from the head office to cope with the situation rapidly. These efforts have helped allow us to be 2. Employee blood donation campaign 3. Computer donation to a grade school in Shunyi district designated the best company in SARS prevention by China government. In addition, we have also promoted 4. Vehicle engines donation to Tsinghua Univ other various social contribution activities such as supporting the Guo An football team, which is a well known 5. 2005 Beijing New Year’s concert, sponsored by BHMC 6. Employees New year’s party professional football team in Beijing. Through activities, we have cultivated friendly relations with the Chinese 7. SARS sanitation activity 8. Signing ceremony of supporting with vehicles for 2008 people and further enhanced our corporate image. Olympic Organization Committee 9. Offering testimonial for the contributors in SARS control

6 7 Q: How do you communicate with employees of your company? A: We offer information on overall business activities regularly to all employees, cultivate talented employees, and give equal opportunities to realize flexible and active communication. We also make efforts to provide good working conditions for employees’ health and safety. When the New Year arrives, we invite family members of our employees to enjoy special events to foster their sense of community and further promote relations among their families. Such activities for promoting communications are performed not only among employees of BHMC but also with Hyundai Motor dealers. 89 Management Environmentally Friendly Product Cleaner Production Communication with Stakeholders 28 29 Hyundai Motor Company / 2005 Sustainability Report Global Management

U.S.A Social Contribution of Hyundai Motor America ABC’s of Car Traffic Safety Education Since automotive related accidents are the #1 cause of Hyundai Motor Manufacturing Alabama, HMMA death and injury for young Hispanic under the age of 34, The ABC’s of Car Traffic Safety is a Hispanic targeted With the unveiling of Hyundai Motor Manufacturing family education program. The program not only Alabama, HMMA, HMC became the first Korean encompasses car safety, it also involves pedestrian safety automobile company to open a manufacturing plant in and bicycle safety issues. HMA’s objective with this the U.S. Featuring 100% made in the USA, production program is to become an automotive company that is actively involved with major concerns in the Hispanic capability is set at 300 thousand vehicles annually. Community and to provide education at an early age to From engine production to the painting process, prevent the number of deaths and injuries from HMMA encompasses the whole production process escalating. This program was launched with the Los from top to bottom. Angeles School District, the Los Angeles Police Department and the Los Angeles Sheriff’s Department. Chairman and CEO, Mong-koo Chung visiting the Assembly line in Alabama plant Ceremony for completion of HMMA Sonata, recognized for quality in U.S. With American production having begun in 2005, 35 Alabama plant for examining quality The booklet created by HMA and the National Assn of quality assurance specialists from the headquarters Highway Traffic Safety Administration is written in both were sent to HMMA and developed a system to English and Spanish and is one of the cornerstones of the program. maintain quality management standards. HMMA has developed rigorous testing and monitoring standards Plant Profile High School Poster Contest and Peer PSA Contest to achieve high quality vehicles. HMC has been Hyundai Motor Manufacturing Alabama Address : 7515 Halcyon Summit Dr. Montgomery HMA wants to emphasize the importance of not drinking working in close relation with Montgomery City and the Alabama 36117, U.S.A. and driving, with high school students being the primary Alabama State Government. Prior to the completion of Total plant site area of 6,900,000㎡ target. The poster contest was launched this spring with Production capacity : 300,000 (units/year) HMMA, production line employees had received basic Vehicles produced : Sonata the Miami Dade Police Department. The high schools in training sponsored by the government for a period of Miami-Dade County participated and three award winning posters were selected, reproduced, and distributed to the six weeks, and 330 managerial level employees high schools. Prizes were awarded to the student received extensive training from HMC’s headquarters winners at a special ceremony. The program is to be and the manufacturing plant in Korea. Furthermore, expanded to the Dallas-Fort Worth area in 2006. the opening of HMMA is expected to create 2,500 jobs This program is a supplement to the ABC’s of Car Traffic directly, and is also expected to have a multiplier effect Safety and will be administered by Hyundai’s Hispanic of an additional 4,000 jobs. Through job creation, Public Relations Agency, Machado/Garcia-Serra Public HMMA is expected to revive the local economy. Relations.

Power of the Purse Program The international media is closely watching the The program is designed to improve public perception of developments of the first made in USA automobile, the the HMC brand and HMC dealers. By providing non- Sonata. BusinessWeek magazine published a special biased factual information on everything involved with the feature story on the Sonata in its September 2004 car buying process, HMC has distinguished itself as edition and the Sonata received accolades in the being one of the first companies that targeted the female October 4th version of the Wall Street Journal. market specifically with an educational tool that would The journal stated, “Through the production of the first enable them to make a more informed purchase. fully made in the U.S., the Sonata, it has provided HMC with the opportunity to take one step closer to becoming a major player in the global automotive market.” Additionally, the Sonata was selected as the “Most Reliable Car” in Consumers Report, earning high ranking in quality, performance and safety.

Alabama Plant, HMMA HMMA is set to play an important role in HMC’s globalization efforts. Including the California Design & Tech. Center, Hyundai·Kia America Technical Center, and the Mojave Proving Ground, HMC has established a complete localized network from vehicle design to Hyundai Motor America the final test stage. Management Environmentally Friendly Product Cleaner Production Communication with Stakeholders 30 31 Hyundai Motor Company / 2005 Sustainability Report Global Management

Global R&D Network

Hyundai-Kia Corporate R&D Division Hyundai Motor Europe Technical Center Hyundai-Kia America Technical Center Inc. Hyundai-Kia Motors California Design & Hyundai-Kia Corporate R&D Division in Namyang is Located in Russelsheim, Germany, this is a state-of- To be opened in late 2005, this newly expanded Technical Center the backbone of the company. Equipped with the-art multifunctional compound designed to facility in Detroit, Michigan will play a bigger role as Located in Irvine, California, Hyundai-Kia Motors cutting-edge facilities, Hyundai-Kia Corporate R&D develop high quality vehicles catering to the tastes we scale up our efforts to design and develop California Design & Technical Center is a cutting Division encompasses the whole design process and preferences of our European customers. vehicles within the United States and it reflects the edge facility which is attracting, new design talent. from pre-design studies, prototyping and full-scale This center was especially designed to meet seriousness of our ongoing commitment to the Its principal role is to research new concepts and aerodynamic testing to crash testing and final test environmental standards in Europe, and to create United States market. This will serve as our core develop vehicle designs that meet the unique tastes driving. The division serves as the hub of our global vehicles that meet these same standards. research and development facility in the United and needs of North American customers. R&D network and consolidates our research efforts The center works in conjunction with our European States and will coordinate closely with our Design & around the world. One of our newest facilities, the subsidiary, managing product planning, marketing, Technical Center and California Proving Ground. Mabook Environmental Technology R&D Center, will and sales. open in September 2005. This center will ensure that all new cars are equipped with the latest in environmentally compatible technologies. Development work is underway on an environmental assessment system that will survey the entire product life cycle from design, to manufacturing, use, and end-of-life vehicle disposal.

California Proving Ground In March 2005, we cut the ribbon on our state-of- Hyundai Motor Japan R&D Center the-art proving ground in California, which at 4,300 Located in Chiba, on the outskirts of Tokyo, this acres in the Mojave Desert, is nothing short of impressive facility focuses on developing cutting- spectacular. This site, together with our new edge technologies in challenging new fields. manufacturing plant in Alabama, means that HMC is Operations at the center are enhanced by their capable of undertaking every step of development, proximity to the Hyundai-Kia Corporate R&D Division from design to testing and vehicle production, on in Korea. North American soil. Management Environmentally Friendly Product Cleaner Production Communication with Stakeholders 32 33 Hyundai Motor Company / 2005 Sustainability Report

Quality Management HMC began to renew efforts on quality management initiatives from 1999. In 2002, HMC and Kia Motors’ product quality divisions were merged to stimulate synergistic effects. For management of overseas quality standards, HMC developed a North American product quality division and an international product quality department in charge of all international affairs to further product enhancement efforts in 2003. In line with the Chairman’s commitment to quality, HMC has chosen quality management as its key initiative. Chairman and CEO Mong-koo Chung has committed to ensure that every stage of production is systematically controlled and validated. Chairman Chung participates in and chairs major quality assurance meetings and emphasizes quality management initiatives.

Pilot Production Center Global Quality Control Office HMC operates the pilot production center to improve supplier’s quality and technological advancements. HMC operates a Global Quality Control Office for quality management policy, of its short and long- quality standards, to reduce product defects, and to For second tier suppliers, HMC has introduced a over 200 countries worldwide to verify quality control term direction, and of its overall objectives. ensure the non-recurrence of malfunctions in new Supplier Quality Marking System (SQ) to ensure issues on a real-time basis. The office operates 24 Furthermore, suppliers receive training and are models. The technical aspects of all newly developed product enhancement and development. hours a day, 365 days a year and is responsible for presented with successful case studies that have set vehicles are tested and verified at the center. Suppliers on all levels are cooperating with HMC’s collecting and analyzing maintenance and quality the precedent. In 2003, HMC established an The center also provides training for production quality enhancement efforts. Through the control data. In March 2004, HMC developed a overseas educational program for employees who workers on technical standards. Models are taken to implementation of quality rating systems, HMC is global network to share quality control information excelled in their field. As a result, 7 employees were the factory for mass production and assembly only aiming to improve the working relationships of the as a means of improving the rate and accuracy of selected and sent to Australia for education. after all stages have been conducted and passed. 150 domestic suppliers and to enhance supplier information that is exchanged. The role of the office quality standards to world-class levels by 2010. is to collect and organize product quality data from Quality Approval System In addition, HMC is working in cooperation with the all HMC subsidiaries and affiliates. When an HMC maintains a quality approval system at each supplier association to improve and maintain overseas maintenance center reports a quality stage from planning to sales. It is only after a vehicle working relationships. control issue to the office, the office collects data to passes quality control standards that it can proceed resolve the quality issue, and then distributes the on to the next level. Before a new vehicle officially Six-Sigma Initiative information to the related quality control departments hits the market, HMC calls a meeting for final vehicle In 1999, HMC adopted Six-Sigma initiative, a in HMC headquarters for appropriate corrective inspection. HMC implements a stringent cross- scientific product quality innovation system to measures and further recommendations. checking inspection system throughout all levels of enhance product quality management. From 1999, All processes headed by the Global Quality Control the company. HMC runs various quality control HMC engaged in the training of Six-Sigma experts Office may be monitored for verification purposes, meetings such as top management quality control and the project was initiated in full force starting and all information can be translated and sent out to meetings chaired by the CEO and weekly and from 2000. 360 projects were cited in 2000, and by the overseas maintenance center. monthly quality control meetings held at production December 2004 the number of cases totaled 5,092. Special session for quality control training facilities. The number of Six-Sigma experts (black belt and Quality Control Training Programs green belt) totaled 3,618 in all fields ranging from HMC offers specialized training and education Supplier Quality Rating System production to research and development. In 2002, sessions to raise employee awareness regarding HMC has established a supplier product quality HMC adopted the Design for Six Sigma System product quality control. In September 2004, about rating system to help improve overall quality (DFSS), a system used to verify the design quality. 3,500 HMC employees received specialized training standards. Although the finished product is used to From 2004, HMC has promoted for more on various topics ranging from product quality determine the overall level of quality, HMC realizes consistency between company objectives and performance review to countermeasure in analyzing that suppliers play a key role in the final grading of a quality control issues by connecting the Six Sigma and improving product quality. Additionally, HMC vehicles’ total quality. HMC has implemented a 5 initiative. Additionally, HMC has called for more provides training for managerial level employees of Star Quality Rating System to better determine a education and has established an online educational its suppliers. Suppliers are informed about HMC’s system specifically designed for green belts. Management Environmentally Friendly Product Cleaner Production Communication with Stakeholders 34 35 Hyundai Motor Company / 2005 Sustainability Report

Brand Management In January 2005, HMC introduced a new corporate direction for brand management, and a resulting global brand slogan to alter company perception, and to enhance brand value and global competitiveness. Hyundai Motor Company as a Leader in the Korean Automobile Industry ‘Refined and Confident’ and ‘Drive Your WayTM’ were selected as the company’s corporate direction for brand The Korean automobile industry first began production about for about 49% of the total automobile exports of Korea, sum management and slogan respectively. The new brand slogan ‘Drive Your WayTM’ensures customer satisfaction 30 years ago. Since then, the Korean automobile industry 31.8 billion USD. Especially, accumulated quantity of vehicles in all facets of life. Based on the brand management strategy, HMC strives to provide consumers with value has become the 5th largest automobile producing country in exported was recorded 10 million units by July, 2004 in the and comfort. the world. In 2004, the Korean automobile industry history of automobile industry in Korea. produced 3.4 million vehicles and exported about 2.4 million vehicles worldwide. As the largest automobile company in According to the Korean Automotive Research Institute, the In 2005, Chairman and CEO Mong-koo Chung Brand Slogan Korea, HMC plays a key role in the Korean automobile automobile industry has a huge economic influence on the announced a new corporate vision, ‘Innovation for industry and in the domestic economy. overall domestic economy, especially with respect to Humanity.’ Through brand management, the aim of employment levels. In 2001, the Korean automobile industry ‘Innovation for Humanity’ is to stir economic growth, Established in 1967, HMC has made remarkable progress numbered 210 thousand employees, outranking Korea’s to refine brand competitiveness, and to improve total in a short period. Through the development of the first largest, the semi-conductor industry by 40 thousand product quality. Ultimately, HMC’s mission is to turn independently made Korean automobile and engine employees. Combining the figures for all related automotive our corporate vision into reality. The slogan means that HMC always gives top priority technology, HMC is the engine that propels the Korean sectors (suppliers, dealers, maintenance centers etc.), the to customers’s satisfaction and does the best to automobile industry. In 2004, HMC produced 1.67 million automobile industry accounted for 1.53 million employees or automobiles in domestic manufacturing plants, 48% of all 10% of the total domestic workforce. Currently, HMC Based on the new brand management strategy, HMC make the life of customers refined and confident. Korean domestic automobile production, and produced 420 employs about 53 thousand workers in Korea. 200 thousand continues to engage in action plans to improve all thousand units of vehicle at the overseas manufacturing workers were employed in some 400 first tier suppliers and aspects of production from the initial design stages to plants. Additionally, 1.12 million automobiles were exported about 500 thousand more in second and third tier supplier after-service. In addition, HMC plans to aggressively worldwide, 47% of all Korean automobile exports. companies. implement its new brand management strategy within This accounted for about 15.5 billion USD which accounts domestic and overseas markets. HMC long-term goal is to become a top 5 global automotive company and one of the top 30 brands worldwide.

As part of its brand strategy implementation, HMC ■ 2004 Number of Vehicles ■ 2004 Number of Vehicles Exported ■ 2004 Number of Vehicles Produced in Korea Produced has developed a Brand Committee, which includes a working level sub-committee. The committee regulates operations for brand consistency, and enhances the brand management system. Brand Statement

For those rational customers who lead a balanced life, we offer stylish and refined cars that are easy to drive with the best quality and safety in the industry. Furthermore, we shall always be thoughtful of our customers and inspire them through top-class services. Ultimately, it is our mission to make each one of our customer’s life more Refined & Confident. Full Line-up 36 37 Hyundai Motor Company / 2005 Sustainability Report

Equus (Centennial) Grandeur (Azera) Sonata Avante XD (Elantra) Terracan Starex (H-1) Porter (H-100 Truck) Libero (H-1 Truck)

Tuscani (Hyundai Coupe) Lavita (Matrix) Verna (Accent) Click (Getz) Mighty II 5 Ton Cargo Tractor Dump Truck

Santa Fe Tucson Trajet XG (Trajet ) County Aero Town Aero Queen 39 Hyundai Motor Company / 2005 Sustainability Report

Environmentally Friendly Vehicles Hybrid Electric Vehicle (HEV) HEV Road Test Demonstration Project HEV vehicles combine the conventional power-train HMC sponsored Korea’s first official HEV Pilot Project by along with the electric motor and the battery providing 50 Getz HEVs to the Korean Ministry of system. As a result, the HEV offers improved Environment in October 2004. The project, which has been undertaken by the Ministry, is to last for 3 years, energy efficiency and an overall reduction in and calls for the testing of HEVs along public roads in emissions. In comparison to conventional the Seoul metropolitan areas. petroleum powered vehicles, the HEV provides a greater than 50% improvement in fuel economy and The Getz HEV drive system combines a 1.5L gasoline a 15% and greater reduction in total emissions. powered engine and a 12kW electric motor along with HMC officially unveiled the HEV in 2004 and plans to the Continuously Variable Transmission (CVT) system. increase production of HEV beginning from 2005. The electric motor is used to increase the performance of the engine, stop and restart the engine when the From the 2nd half of 2005, HMC is to commence the vehicle is at rest, and drive the vehicle at low speeds. small scale production of the Verna HEV, included in In addition, the HEV provides less damage to the power Environmentally Friendly Product which will be superior fuel economy improvements train during acceleration. During deceleration, the HEV achieved earlier. HMC also plans for the stores kinetic energy which is later re-used during the HMC has begun to place greater emphasis on the R&D of new environmentally compatible technologies in support of its development and full scale production of the Sonata acceleration phase, thus reducing overall gas environmental protection initiatives. Focus has been placed on technologies to reduce exhausted emissions from vehicle, HEV by the latter half of 2007. To play a leading consumption. The HEV allows HMC to achieve superior and to enhance the recycling efficiency of end of life vehicles. In order to achieve those objectives, HMC has continued role in the global HEV market, HMC plans to fuel economy and low emissions without sacrificing to focus on the development of low emission and zero emission technologies, such as hybrid electric power-train and commence full production of selected futuristic HEV performance, helping to improve overall air quality of metropolitan area. fuel-cell technologies. Furthermore, HMC has been researching on the development of eco-friendly materials to eliminate models by the year 2010. the potential release of hazardous substances from vehicles. In addition, HMC has increased efforts to use easily recyclable materials in the design and has centered itself on reducing pollutants emitted during the end of life vehicle ■ Specifications of Getz Hybrid Electric Vehicle disposal stage. Type Parallel Engine 1,400cc DOHC gasoline Motor BLDC / 12kW

Battery Nickel-metal hybrid (144V)

Transmission CVT (Continuously Variable Transmission) Max. speed 161km/h

Getz Hybrid Electric Vehicle Emission ULEV (Ultra Low Emission Vehicle) 1

■ Korea and Overseas Emissions and Fuel Economy Regulations

■ EU ELV Directive HMC unveiled Getz HEV at the ceremony event of “The Next Government HMC delivered Getz HEVs to the Korean Ministry of Environment Designated Growth Engines”. Management Environmentally Friendly Product Cleaner Production Communication with Stakeholders 40 41 Hyundai Motor Company / 2005 Sustainability Report

Fuel Cell Electric Vehicle (FCEV) The Fuel Cell Electric Vehicle (FCEV) uses hydrogen, Hydrogen Fleet & Infrastructure Demonstration and Hydrogen Fueling Station in California methanol, or natural gas as its main fuel source in Validation Project As part of the Hydrogen Fleet & Infrastructure reaction with oxygen, resulting in the outflow of HMC has been selected by the U.S. Department of Demonstration and Validation Project, HMC completed electricity. Presently, the Proton Exchange Energy to take part in the Hydrogen Fleet & Infrastructure the construction of its first hydrogen fueling station Demonstration and Validation Project. From 2004 until Membrane Fuel Cell System is widely used in FCEV located at the Hyundai-Kia America Technical Center in 2009, the project allows HMC to test drive FCEV on U.S. Chino, California. A state of the art facility, the fueling and efficiency levels stand at 55-60%. FCEV offers roads for a period of 5 years. HMC is the first Korean station produces 15kg of natural gas per day. a quiet ride and is environmentally friendly like its company to be selected as a partner of U.S. government Daily fueling capacity is 30 vehicles and fueling takes predecessor, the Electric Vehicle (EV). However, sponsored project. The project presents opportunities for roughly 2 minutes to complete. Working in cooperation unlike the EV, the FCEV offers improved fuel HMC to further develop cutting edge FCEV technology with Chevron Texaco, HMC has made plans to build and to establish the global standard. economy to the HEV. The FCEV includes Hydrogen Fueling Pump more hydrogen fueling stations in California and other enhancements in re-fuelling ease, increased power As an active partner, HMC stands at the forefront in the states. development of FCEV technologies as well as related and better overall performance. Using hydrogen as and 1 silver medals, and 3 gold and 1 silver medals standards and regulations pertaining to FCEV. a fuel source, the only emission from FCEVs is H2O. in the 2003 race. In 2002 and 2003, the Sante Fe Other partners taking part in the project include GM, FCEV competed in and completed the California Even when liquefied fuel sources are used, exhaust DaimlerChrysler, Ford, Toyota, Nissan, Honda etc. emissions are minimal with Fuel Cell Partnership Road Rally. In 2004, HMC was Set to end in 2009, the U.S. government has set a the exception of CO2 selected as s partner in the Hydrogen Fleet & budget of approximately $380 million USD over the emissions. Infrastructure Demonstration Project. The program duration of the project. By participating in the Hydrogen enables HMC to test-drive the Tucson FCEV and Fleet & Infrastructure Demonstration and Validation In replacement of the 1st construct hydrogen re-fuelling stations in major U.S. Project, HMC aims to stabilize technological levels and to build infrastructure in major cities throughout the U.S. generation Sante Fe cities for the next 5 years. HMC is planning HMC is working in partnership with Chevron Texaco and FCEV, HMC introduced production technology improvements in FCEV fuel UTC Fuel Cells to ensure the completion of these nd the 2 generation Tucson efficiency, long distance drivability, and low objectives. FCEV in December 2004. temperature startups to begin low-scale production HMC plans to use the Tucson FCEV model for testing The Tucson FCEV of FCEVs by 2010. during the 5 year term of this project. Tucson FCEV outperforms its predecessor, the Sante Fe FCEV in performance, reliability, durability, and safety. The Tucson FCEV offers new technological advancements unseen before. Having been started in conditions reaching -20℃, one of the Tucson FCEV’s main features is the ability to start in frigid weather conditions. Powered by an 80kW engine, the top speed of the Tucson FCEV is 150km/h. Reaching 0 to 100km in 15 seconds and needing only a single charge to drive a maximum distance of 300km, the 2nd generation Tucson FCEV is superior in every respect to its predecessor. Hydrogen fueling station in Hyundai-Kia Corporate R&D Division

HMC has received recognition for its technological advancements in the FCEV. Since 2001, HMC has Hydrogen fueling station in California competed in the Michelin Challenge Bibendum, an environmentally friendly vehicle racing competition. In 2001, the Sante Fe FCEV was awarded 2 gold Management Environmentally Friendly Product Cleaner Production Communication with Stakeholders 42 43 Hyundai Motor Company / 2005 Sustainability Report

Fuel Economy & Emissions Plasma Coating Catalyzed Particulate Filter Environmentally Friendly Public HMC has developed environmentally friendly diesel Engine efficiency can be improved when the valve- To reduce particulate matter (PM) emissions, HMC Transportation engine vehicles that emit low levels of CO2, NOx train and piston parts, which contribute has developed the Catalyzed Particulate Filter (CPF) Natural gas is the preferred source for full sized and and particulate matter (PM) offering high fuel approximately 70% of all friction in engine, are used in diesel engine technology and has set plans larger engines due to its low emissions of CO2 and efficiency. The Common Rail Direct Injection Diesel plasma coated. HMC achieved a 4% improvement for production. HMC’s innovative CPF technology high power output. HMC has been developing Engine (CRDi), the Variable Geometry Turbo-charger in engine efficiency through the application of reduces PM emissions from the diesel engine by compressed natural gas (CNG) vehicle technology (VGT), and the Exhaust Gas Reduction (EGR) plasma coating tappets, piston rings, and piston over 90%. since 1995 to improve the air quality of the enhance the environmental friendliness of HMC’s skirts. Encouraged by this success, HMC is taking metropolitan area and to diversify the use of fuel diesel vehicles. Plans have been taken to introduce plasma coating technology to the next level. Environmentally Friendly New Diesel sources pertaining to the government policy. Catalyzed Particulate Filter (CPF) enhancements in Research on coating process optimization has been Engine Technology Symposium From 2003, HMC has produced and sold Global completed and is ready for application. Also, HMC passenger vehicles in compliance with Euro-IV to Due to the increased interest in diesel powered 900 CNG buses for commercial use. In 2004, HMC sent a Korean delegation to the Korea-Germany curb air emissions. In addition, research efforts for passenger vehicles, HMC is building networks and developed the first domestic environmentally friendly plasma coating research project to develop ways to Homogeneous Charge Compression Ignition (HCCI) working in close association with related institutions. natural gas accordion bus, and plans to market the reduce cost in plasma coating processes. is being undertaken, advanced technology In October 2004, HMC co-hosted the 4th annual bus in the near future. HMC’s accordion buses responsible for reducing NOx emissions. Environmentally Friendly New Diesel Engine offer more comfort than conventional models, and is Diesel HCCI Engine Technology Symposium with Bosch Korea focused more on safety. New features in the form Gasoline CAI Engine One advantage of diesel-powered engines is higher Mechanics and Electronics at the Hyundai-Kia Next of a sturdier body frame, a rear camera, disc HMC is developing the Controlled Auto-Ignition fuel efficiency along with low emissions. However, Generation Vehicle Research Institute, Seoul National brakes, ABS, and operational wheelchair fastening Engine (CAI), specifically designed to reduce NOx internal combustion chamber related problems may University. Discussions were held with the 11 equipment have been added. emissions produced from gasoline engines. result in excess NOx emissions. In response to this related organizations that attended. Topics included The CAI engine reduces NOx emissions by over problem, HMC has been developing the discussions on Euro-IV compliance and the 90% compared to existing conventional engines. Homogeneous Charge Compression Ignition (HCCI), development of new diesel engine technologies. In addition, fuel efficiency improves by 15% when technology that reduces the overall amount of NOx In addition, HMC introduced new CPF, a new PM the Gasoline Direct Injection System is applied to emissions. reduction technology for the diesel engine. the Gasoline CAI engine.

■ Gasoline CAI Engine NOx Emissions ■ HCCI Combustion

Ideal combustion at low temperature 4th Environmentally Friendly New Diesel Engine Technology Symposium Environmentally Friendly Natural Gas Accordion Bus hosted by HMC Management Environmentally Friendly Product Cleaner Production Communication with Stakeholders 44 45 Hyundai Motor Company / 2005 Sustainability Report

Aluminum Space Frame Body Design for Lean Product Starting in November 1998, it took 4 years for HMC Centennial Aluminum Trunk Lid Lighter Reinforced Body Plate to develop an aluminum space frame body as part of Design for Lean Product (DfLP) plays a key role in In December 1998, HMC initiated joint research with the G7 Next Generation Vehicle Development Project. our efforts to increase fuel efficiency. HMC has been other companies to develop lighter reinforced body The result is improved rigidity, and a 40% lighter and developing aluminum plating with high feasibility and plates. It took 5 years for the joint research team to higher energy absorption rate during collisions than practicality. In November 2003, we started to mass- complete the project. As a result, HMC now holds conventional mono-coque frame bodies. Moreover, it produce these items for use on our Centennial tailored blank technology and partial reinforcement is quicker to assemble because it requires a fewer model reducing its weight by 6.6kg. It is Korea’s technology, capable of reducing the plate weight by number of parts. It is therefore more economical and first case of applying aluminum plating in a 10% and doubling the rigidity of body plates more adoptive to model changes. commercial model. (590MPa). The partial reinforcement technology is It is especially advantageous in small-scale Aluminum plates are difficult to shape compared to expected to increase the rigidity of the total body by production. HMC plans to apply the technology to Aluminum Body (Forming) steel plates due to their anisotropic property, which 25% and collision safety by 15%. HMC plans to Ultra-high Fuel Efficient Vehicles (UFEV) such as 3- Aluminum Body (Extrusion) ■ Aluminum Space Frame Aluminum Plating creates limitations for traditional ways of plate replace up to 80% of conventional body plate with litre cars. In the case of the Getz HEV, the forming. We developed new press technology and this lighter reinforced body plates by 2006. conventional hood, door and tailgate are planned to design specifications to solve the problem with the To overcome the increased amount of tearing, be replaced with aluminum parts. elongation of aluminum plates. In addition, HMC ripping and/or wrinkling during the manufacturing developed a work manual to specify operation process because of higher rigidity levels we procedures for minimizing quality problems. developed new shape forming, painting and welding Aluminum hoods and trunk lids are often used in technology as part of the project. luxury vehicles. HMC plans to apply this pioneering technique to other model lines.

■ Getz HEV applying Aluminum Space Frame

Steel Trunk Lid Aluminum Trunk Lid Body frame Made of Lighter Reinforced Body Plate Management Environmentally Friendly Product Cleaner Production Communication with Stakeholders 46 47 Hyundai Motor Company / 2005 Sustainability Report

EU CO2 Emission Reduction Convention to Curb Global Warming The Climate Change Convention Task Force Team

HMC actively participates in developed countries’ Steering). In 2004, HMC’s vehicles in the European Corresponding to the Kyoto Protocol on Climate Change, HMC officially began the Climate Change Convention Task Force Team in February 2005. The TFT outlines the development and production of efforts to curb CO2 emissions, the main contributor market recorded average CO2 emissions of of global warming. In June 1999, KAMA (Korea 166g/km, meeting the 165~170g/km targets environmentally friendly vehicles, energy efficiency improvements in the production process and prescribes practices that adhere to the Kyoto mechanism. HMC’s Climate Change Convention TFT was created to Automobile Manufacturers Association) along with prescribed by KAMA. KAMA posted average CO2 protect the natural environment and its role extends to initiatives to enhance the future economic HMC made a commitment to the EU’s CO2 Emission emissions of 168g/km, again achieving posted competitiveness of HMC. Reduction from Passenger Cars. As outlined, HMC targets. To meet the forecasted CO2 emissions of voluntarily agreed to reduce passenger vehicle 140g/km for 2009, HMC continues efforts to In compliance to the Kyoto Protocol, HMC is working in close association with the national government to average CO2 emissions output to 165~170g/km by develop low CO2 emissions emitting vehicles. 2004. By 2009, HMC plans to reduce passenger promote emissions reductions and to ensure that the development of new forms of clean energy objectives are met. As its initial step, HMC implemented the TFT in 2005 and has begun to analyze more aggressive vehicle average CO2 emissions levels to 140g/km. ■ Corporate Average Fuel Economy of HMC Compared to HMC’s passenger vehicles exports to energy reduction strategies. These efforts have been undertaken to implant the importance of understanding the European market, which averaged 197g/km in the climate change issue within the general public. As its next step, HMC plans to work in partnership with 1995, KAMA’s reduction estimates call for a 14% the national government, post secondary institutions and NGOs to apply cleaner production solutions to the and 29% decrease by 2004 and 2009. entire value-chain of the automobile industry by 2006. Finally, HMC aims to establish a stringent climate change management system, which includes the development of an environmentally friendly vehicle, and to In response to the EU, HMC introduced the Getz D- actively participate in the emissions trading demonstration project by 2007. To prepare for Korea’s inclusion 1.5 CRDi diesel powered subcompact. in the Kyoto Protocol, HMC is actively undertaking these voluntary emissions measures. With average CO2 emissions of 116g/km, the diesel powered Getz has been available in European markets since 2003. To minimize CO2 emissions, HMC’s line-up of vehicles feature less engine friction, low friction tires, an HSDI diesel powered engine, CVVT, and MDPS (Motor Driven Power

■ Trend of Average CO2 Emission from Passenger ■ Outline of Voluntary Agreement on EU Cars in the European Market CO2 Emission Reduction

(Units : g/km)

KAMA ACEA JAMA Remark

Intermediate 165~170 165~170 165~170 target (2004) (2003) (2003) (year)

Passenger Final target 140 140 140 Cars (year) (2009) (2008) (2009) (9>)

Additional 120 120 120 target (2012) (2012) (2012) (year) Management Environmentally Friendly Product Cleaner Production Communication with Stakeholders 48 49 Hyundai Motor Company / 2005 Sustainability Report

Recycling HMC has been working to improve the Life Cycle Assessment Recyclability Assessment Information System in the Design for Disassembly environmentally friendliness of its products. HMC has been performing Total Car Life Cycle Designing Process (RAIS) For more efficient and environmentally friendly vehicle In compliance with the EU directive on end-of-life Assessment (LCA) to determine the overall RAIS is a recyclability evaluation program that was disposal, HMC has been developing various launched in 2002. The system allows designers to input technologies of Design for Disassembly (DfD) since vehicles, HMC has been developing and applying environmental impact of the automobile. The results and evaluate material recyclability, parts recyclability, 1998. In 2001, HMC integrated DfD assessment and various heavy metal-free parts, and has registered of LCA are applied to HMC’s Design for dismantling issues and total related costs. In addition, the optimal design techniques into the RAIS through the joint on the International Material Data System (IMDS), a Environment (DfE), a system encompassing the system allows designers to compare the recyclability of research with several Korean domestic universities. monitoring and managing system of harmful entire vehicle’s life cycle from development to HMC automobiles to that of other non-HMC manufacturers. HMC has also been developing the integrated DfD chemicals. HMC has been implementing the Life disposal. For more extensive and efficient LCA, HMC has been developing a software enabling designers to solution system coupled with a professional system Cycle Assessment (LCA) from the production design HMC plans to develop a joint system along with a compute the rate of recycling and recovering of vehicles offering optimal design solutions since 2004. stage to the disposal stage to better assess the total systematic database program and LCA sold throughout the EU. The software will be officially The system can offer the alternative design solution of implemented in October 2005. environmental ramifications of vehicles. In addition, methodologies. improving efficiency of disassembly. HMC is developing recycling technologies to reduce the waste generation in the disassembly stage. Environmentally Friendly Vehicle Design Guidelines Alternative Material Technology for Heavy Metals To exceed a 95% weight-based recycling rate in the In December 2004, HMC issued the Environmentally HMC has developed alternative material technology free Friendly Vehicle Design Guidelines for both HMC’s R&D of heavy metal content and monitors the use of heavy disassembly process by 2015, HMC aims to develop staff and suppliers to communicate the company’s metals in supplier made parts. In compliance with EU new recycling systems and technologies, including initiatives regarding recycling. ELV directives regarding the use of heavy metals, HMC Environmentally Friendly Design for Recycling the construction of facilities. ■ has developed lead-free steel plates, paints, wire coverings and brake lining including cadmium-free adhesives. As a substitution, HMC has replaced the use ■ Design System for Recycling of chrome (Ⅵ) plating with parts developed from chrome (Ⅲ). Working in cooperation with suppliers, HMC developed the Korean website version of the International Material Data System (IMDS) in 2003 and has commenced educational training sessions for suppliers.

Material Labeling Material labeling plays an important role in HMC’s recycling efforts. All vehicle parts made of plastic and rubber over 50g are labeled accordingly to improve the recycling efficiency rate. Management Environmentally Friendly Product Cleaner Production Communication with Stakeholders 50 51 Hyundai Motor Company / 2005 Sustainability Report

ELV Disassembly Plant ■ Disassembly Process Vehicle Recycling In November 2004, HMC completed the construction Parts Recycling Catalysts Recycling of the ELV Disassembly Plant. The plant includes HMC is developing various waste parts recycling Platinum Group Metals (PGM) are used as the main state of the art disposal equipment and related technologies for use in the production of new catalyst to refine petroleum and to purify exhaust technologies and has a maximum recycling capacity vehicles. In line with its plastic and rubber recycling emissions. Due to rising global demand and the of 4,000 vehicles. Composed of 8 phases, the plant initiatives, HMC recycles vehicle carpets and seating relatively high cost of PGM, recycling initiatives have includes a continuous flow disassembly system along foam, and reuses these parts in trunk trim and noise been set as a major priority. In partnership with with a system, which monitors recycling. Efficiency 1 reducing padding parts. In addition, HMC plans to suppliers, HMC established a joint venture that is enhancements and more accurate monitoring of the initiate a recycling system for waste bumpers the first domestic environmentally friendly PGM disposal process have been achieved as a result of starting from 2005. Waste bumpers from disposal recycling company in September 2004. Working in the establishment of the plant. and A/S centers are to be re-circulated through re- association with suppliers, the establishment of the use, and remade into bumper covers and engine recycling company allows for HMC to achieve cost under-covers sold in the aftermarket. The system savings reductions and continued progress in the allows for the large-scale re-circulation of materials domestic automobile industry. Dismantling Manual 2 Using the International Dismantling Information System from used bumpers and for the elimination of (IDIS), HMC publishes and distributes dismantling disposal wastes through recycling. manuals for all new models in EU dismantling service providers. Dismantling information regarding new HMC models are updated twice per year. Domestically, HMC publishes the electronic manual on its website and on DVD for dismantling service providers. 3

4

IDIS Website - in Korean, IDIS DVD 1. Explosive parts treatment 2. Fluid recovery 3. Interior, exterior parts dismantling 4. Engine, transmission dismantling

■ ELV Disassembly Plant Process Flow 53 Hyundai Motor Company / 2005 Sustainability Report

Energy Greenhouse Gas HMC has been applying new energy savings initiatives In 2004, 97% of HMC’s energy sources were a result of and conducting performance evaluations regarding LNG and electricity usage, sources which emit relatively energy savings on a regular basis. Technologies for LNG low levels of CO2. CO2 emissions increased by 11% to and other environmentally friendly energy sources are 1.62 million tons and emissions per sales decreased to being developed and introduced in an effort to maximize 50.6 tons/billion Korean Won. The amount of CO2 this initiative. emitted during the production of a single automobile was 770kg, a drop of 23kg per vehicle from the previous year. In 2004, the energy consumption from domestic and overseas operations totaled 32.3 million GJ. Water This represents an 11.4% increase in total consumption In 2004, total water consumption from domestic and from the previous period as Beijing Hyundai Motor overseas operations totaled 14.5 million m3, an increase Company (BHMC) was accounted for. Although total of 20.6% from the previous year. Water consumption per energy consumption has risen, consumption per sales sales, however, decreased to 450 m3/billion Korean Won. (1,010 GJ/billion Korean Won) fell from the previous The Asan manufacturing plant and HMI continue to period. implement a zero discharge system to utilize and to recycle wastewater. In 2004, 1.18 million m3 of ■ 2004 Energy Sources Categories wastewater was recycled, representing 8.2% of total Cleaner Production water usage.

Cleaner production is a management tool to increase productivity and environmental friendliness by optimizing natural resource use. It is also a measure to achieve cost reduction and environmental protection by preventing environmental damage from raw material extraction to the final disposal of the product. HMC has adopted Life Cycle Assessment (LCA) and Design for Environment (DfE) from the design stage of product development. HMC has also adopted cleaner production technologies in manufacturing to prevent and/or minimize impacts to the environment. HMC has been improving the recyclability and reusability of the product. Also, we have been searching for alternative resources to replace restricted materials in the European Union End of Life Vehicles Directive. ■ Energy Consumption ■ Greenhouse Gas Emissions ■ Water Sources

■ Cleaner Production

Zero-Discharging Wastewater Recycling System ■ Zero-Discharging Wastewater Recycling System Plan HMC Asan plant and HMI implemented the Zero- Discharging Wastewater Recycling System. The system can treat whole wastewater from production processes, employees’ residence, office, cafeterias.

Wastewater Treatment Facility Management Environmentally Friendly Product Cleaner Production Communication with Stakeholders 54 55 Hyundai Motor Company / 2005 Sustainability Report

Raw Materials Waste HMC has been making efforts to continuously extend Reduction of Metal Scrap HMC disposes of the wastes produced from Recycling Rust Preventive Oil the use of recycled materials and to enhance the To reduce the amount of metal scrap in the blanking automobile manufacturing processes in compliance HMC has introduced a new facility used in the recycling of rust preventive oil, which is used to protect production efficiency of the utilization of resources. Especially, process, HMC has optimized the panel, profile and the with related laws and regulations and the wastes equipment. Through application, less waste and higher with respect to the use of important raw materials, iron trim line of the metallic pattern. As a result of this produced is in trends of continued reduction by modification, overall scrap width has been reduced by cost savings have been achieved. Overall, 50% of the and aluminum, the defect ratio percent defective is expansion of recycle application. Since 2004, 40mm and, a reduction in total scrap waste as well as used rust preventive oil is now recycled and only two- reduced by improving the press process and the higher cost savings has been achieved. computation of quantity of wastes produced has thirds of the initial total amount of oil is presently used. quantity of waste materials produced during production been modified and waste metal which accounts for by complementing the design of die set. In addition, the main portion of total wastes has been deleted. the lightweight automobile process is under progress Metal can be recycled in full and used for other by improving materials used for the body, engine and industries as raw materials and thus regarded as other parts and rationalizing some parts and aluminum, waste materials and excluded from total the wastes. which is a kind of material used for realizing lightweight, Therefore, it is shown that the quantity of general and used for the engine which accounts for a large wastes and recycle wastes which were included in portion of the total weight of automobile. In 2004, metal wastes previously is remarkably reduced and, there also has been a great change in the computation total waste produced in 2004 totalled approximately. of raw materials. Metal wastes are regarded as the 260 thousand tons. HMC has been continuously concept of waste materials to be excluded from the increasing the recycle ratio by improving its waste wastes and the quantity of scrap sold as waste management system. In 2004, up to approximately materials is also excluded from raw materials. 78% of wastes except for the waste metal as Improving Waste-oil Collection Method Accordingly, it’s shown that the quantity of iron and mentioned above was recycled and remaining waste A water-oil separating facility has been implemented to aluminum used in 2004 was considerably reduced, 530 of approximately 60 thousand tons was disposed by decrease the amount of waste-oil generated from milling thousand tons of iron and 48 thousand tons of incineration, reclamation and discharged into the sea. the process, and to improve the recyclability rate of aluminum annually. To examine the trends of increase waste-oil. Previously, the top portion of the waste-oil of aluminum engine from 2004, a research on the was extracted from waste-milling oil tanks. With this method, the extracted and collected waste-oil contained quantity of iron used was conducted dividing the ■ 2004 Waste Categories lots of water, exactly water-soluble milling oil. It caused quantity of iron into that for press and engine, and the a distorted measure of waste-oil generated. results showed that the quantity of aluminum engines produced accounted for 22% (in weight). For quantity of paint used for coating, with continuous new coating technologies as electrostatic coating-pure water cleaning recycle technology and robobell being introduced, efficiency of coating work was enhanced and paint consumption reduced.

Raw Materials Usage ■ ■Waste Generated Management Environmentally Friendly Product Cleaner Production Communication with Stakeholders 56 57 Hyundai Motor Company / 2005 Sustainability Report

Air Emissions Reducing Packing Waste Water Soluble Painting HMC continues to implement strict internal emission Cleaner Energy Source HMC has engaged in a parts packing improvement Replacing the use of the traditional solvent based standards at a stringent 10~30% of the domestic HMC has been replacing B-B oil with LNG as an energy initiative to reduce suppliers’ over-packing and has painting system, HMC has implemented the water- regulations. In 2004, total CO, NOx, SOx, and PM source. Emissions of CO2 and other pollutants have begun to promote the use of recyclable forms of packing. soluble painting systems. As a result, a 50% reduction emissions totaled 1,262 tons, a reduction of 7.4% decreased and, at the same time, an overall decrease in in VOCs emissions has been achieved. Additionally, as the use of toxic chemicals, which are used for emissions lower temperatures are now needed in the paint-drying from the previous period. control facilities maintenance, has been achieved. process, overall energy efficiency levels have been reached. Volatile Organic Compounds (VOCs) ■ Reduction of Air Emissions after Energy Source ■ Air Emissions (Domestic) HMC has been exerting efforts to reduce the use of VOCs Control Facility paint and solvent in its painting process. For this, it In order to effectively reduce the outflow of VOCs and is in the process of replacing outmoded VOCs other odor emissions, regenerative thermal VOCs control facilities have been installed. An emissions improvement control facilities and adopting new technologies to of 100 tons per year is a direct effect of this introduction. improve overall VOCs removal efficiency. Further upgrades with activated carbon to the facilities By widening the application of water soluble paint, have led to improvements in efficiency of controlling HMC has decreased the use of solvent and has VOCs emissions. increased the recycling rate of used solvent. As a result, VOCs emissions for 2004 dropped 25% to 9,956 tons and the recycling rate of used solvent Replacement of the Outmoded Air Quality Control increased from 29% to 39% from the previous year. Facility 10 year old and older air quality control facilities have been replaced. Replaced facilities have shown a marked improvement in dust collection and energy efficiency, ■ VOCs Emissions (Domestic) and have led to a reduction in CO2 emissions including other pollutants.

Application of the Refrigerant Coolant Recovery VOCs Control Facility System HMC has adopted a new refrigerant coolant recovery system. The system allows for the extraction of Robobell Type Painting remaining refrigerant in the injection pipe and induces a The efficiency of the painting process has improved as a reduction in material usage as well as the amount of air result of replacing the Gun Type system with the The pollution produced. Robobell type. The Robobell type is designed to paint along the curvature of a car surface resulting in the reduction of paint over-use, the improvement of VOCs emissions and the decline in other raw material costs.

Robobell Type Painting Booth Management Environmentally Friendly Product Cleaner Production Communication with Stakeholders 58 59 Hyundai Motor Company / 2005 Sustainability Report

Wastewater Discharge Chemicals ISO 14001 Environmental Management Environmental Expenditure HMC has been successful in managing COD HMC stringently manages chemical use, especially System HMC’s total environmental expenditure is separated (Chemical Oxygen Demand), BOD (Biochemical the use of NaOH, H2SO4, HNO3 and HCl. In an effort to establish and develop environmental into two parts, environmental investment and Oxygen Demand), SS (Suspended Solids), and N-H Under HMC’s chemical management guidelines, management practices to a global level, ISO 14001 environmental expense. Environmental expense has (Normal Hexane) levels, in compliance to Korean fume control equipment is required in all chemical certification was obtained for HMC operations. been split up into 5 categories. As stated in the Environmental Standards, reaching only 10~50%. storage facilities. Additionally, chemical containers Beginning with the Ulsan manufacturing plant in 2003/2004 Sustainability Report, environmental In accordance with Korean environmental law, HMC are required for recollection by the chemical supplier 1995, all of HMC’s domestic operations including its investments for production were included with was fined once for leakage of milling-oil to a nearby and recycling company. Chemical managers are 23 after-service centers have been ISO 14001 environmental expenses figures until 2002. stream. As a result, they fortified the milling-oil required to participate in periodic training programs certified. The certification for HAOS and HMI were However, HMC separated these categories from container and took further preventative measures. and chemical storage facilities are subjected to obtained in 2003. Currently, ISO 14001 Certification 2003 and onward. Beginning from 2004, HMC has stringent inspections. The amount of chemical use for BHMC is in process and certification preparation been developing a new environmental investment has a direct correlation to production because is being made for HMMA. valuation system. In 2004, environmental expenses ■ Wastewater Discharge (Domestic) chemicals are used in the electro-deposit wash amounted to 37.2 billion Korean Won, a 12% water and wastewater treatment processes. Environmental Audits increase from the previous period, and the total However, water treatment significantly minimizes the environmental investments amounted to 78.1 billion HMC continually conducts internal and external toxicity of chemicals. HMC’s chemical management Korean Won. audits to investigate the effectiveness of initiatives are centered on the safety aspects of Environmental Management Systems (EMS) and to handling, storage, use and the disposal of all promote continual process improvement. During a chemicals. 10-month span from February to December 2004, ■ Environmental Cost 63 departments were audited on process improvement results and effects, documentation on work process, and the appropriateness of Chemical Management Training environmental management initiatives. The majority HMC stringently monitors its wastewater discharge of internal audits focused on incidents of non- points and levels in order to reduce the frequency and severity of potential environmental accidents. In 2004, compliance to regulations. The 2004 internal audit 2,276 employees were trained regarding chemical exposed 114 cases of non-conformity of which, management, and various information on the chemical 95.6% or 109 cases were quickly resolved. In May ·· handling manuals and guidelines are updated at the and June of 2004, TUV-Korea conducted external HMC’s internal Environment, Safety & Health Information audits on 50 departments including those at the System (i-ESH). Along with employees, external headquarters, the Ulsan, Asan and Jeonju chemical waste management service providers are manufacturing plants. A total of 5 recommendations ■ Chemicals Usage actively involved in the chemical management program. were made and corrective actions were taken in a HMC has begun MSDS (Material Safety Data Sheet) training programs on MSDS manuals and toxic chemical timely matter. management with over 130 employees of chemical waste management service providers, and continue to provide educational outsourcing for 26 of our domestic suppliers. *i-ESH website : http://iesh.hmc.co.kr 61 Hyundai Motor Company / 2005 Sustainability Report

Customer In line with its policies to provide high quality vehicles Customer Satisfaction and Management Decision and first rate service, HMC is actively involved in Making communication with customers. In addition, HMC For continual improvement in the field of customer operates various customer satisfaction programs to satisfaction, HMC established a process to reflect the ensure the retention of its existing customer base. results of a customer satisfaction survey into making management decisions. The results of Hyundai Customer Satisfaction Index (HCSI), Korean Standard Marathon CS Service Quality Indexes (KS-SQI), Korean Customer HMC operates Marathon Customer Satisfaction Satisfaction Index (KCSI) and National Customer (CS), a program that helps employee better focus on Satisfaction Index (NCSI) are included in key performance the customer satisfaction objectives being tendered index of different divisions in HMC. Particularly, opinions at HMC. Voice of Customer (VOC) is an integral and suggestions from surveys managed with special care. Corrections and improvements are reviewed semi- part of Marathon CS where customers directly voice annually and employees are provided with customer their opinions and where employees are given the satisfaction training every year. Communication with Stakeholders opportunity to listen directly to voiced customers’ opinions. To improve customer satisfaction, HMC Prior to being a leading automobile manufacturer, HMC is pursuing to become a responsible member of the global has appointed regional CS managers. Working with community. As a global corporate citizen, HMC is actively fulfilling responsibilities by providing employment A/S providers to improve the entire chain of opportunities and by focusing on stakeholders’ interest on sustainable growth issues of the company. HMC also customer satisfaction services, HMC operates the contributes to the national economy and focuses on the sustainable developmental issues of the community. CS Plaza, a database system which encompasses a procedure manual and information pertaining to In pursuit of customer and community satisfaction, HMC minimizes environment impacts, provides high quality customer satisfaction. vehicles and service. Renewed emphasis has been placed on the mutual growth between business partners and the company, and on providing various educational opportunities and a safer working environment for employees. *CS Plaza website : http://csplaza.hmc.co.kr As the foundation of its sustainability management initiatives, HMC is building trust by establishing effective communication channels with stakeholders. Through communication with stakeholders, HMC has increased awareness of its environmental, economic, and social responsibilities, has begun to develop and solidify mutual trust, and has shared in its sustainable development efforts. In pursuit of excellence in sustainability management, HMC set Sustainability Communication Strategy (SCS) and developed communication methods through organizational restructuring in 2004.

The Best Environment Report Award Hyundai Motor Company 2003/2004 Sustainability Report took the Best Environment Report Prize in 2004 Corporate Environment Report Award hosted by Korea C

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l i T n g Management Environmentally Friendly Product Cleaner Production Communication with Stakeholders 62 63 Hyundai Motor Company / 2005 Sustainability Report

Overseas Customer Satisfaction J.D. Power & Associates In April 2004, J.D. Power Domestic Customer Satisfaction Customer Safety Which Magazine HMC received top marks in & Associates released its 2004 Initial Quality Study National Customer Satisfaction In national HMC has long been pursuing developments in vehicle durability for 2003 and 2004 from UK results. The study was conducted on new car customer satisfaction appraisement, HMC has comfort and performance. In line with these consumer report, Which Magazine. The Getz buyers from November to December 2003. obtained the No.1 ranking in the NCSI (National initiatives, HMC has placed a renewed focus on ranked number one out of 81 new vehicles, HMC outranked some of the automobile industry’s Customer Satisfaction Index) for 4 successive years. safety issues through the implementation of various displaying no problems for 2 years running. heavyweight with a total index score of 102, HMC technologies regarding passive and active safety nd The magazine ranks all vehicles based on durability jumped 8 spots to place 2 overall in the 2004 This survey was conducted against customers who features. To ensure passenger safety during th and consumer satisfaction. As the survey results ranking. Additionally, HMC ranked 7 overall purchased an automobile within the last three years collision, HMC has developed advanced safety are published every August, the magazine influences corporate level study regarding the product quality. and had six months of experience of use, in the features such as an advanced body frame and the consumer preferences regarding purchasing car. The New EF Sonata ranked first in J.D. Power & most of detailed items making up the customer Smart Airbag. HMC continues to develop electronic Associates’ study for the entry mid-size segment, the survey satisfaction HMC ranked No.1, confirming safety features ranging from air pressure sensors Strategic Vision In October 2004, Strategic Vision first Korean automaker to receive the ‘2004 Winner leading status once again. monitoring equipment. published its Total Value Index Study (TVI). HMC Award.’ The Santa Fe and Accent ranked number NCSI is determined based on relations among ranked number two overall in the value satisfaction two in the SUV and compact car segments product/product service, the expectation index of HMC is committed to ensuring the safety of its study, trailing only the leader, a major Japanese respectively. HMC vehicles scored higher than the customers and recognition value. Through this drivers and passengers through rigorous R&D automaker. HMC’s Elantra, Grandeur and Santa Fe industry average including the Accent and the NCSI, customers can check the consumer behavior. advancements. The Elantra and Grandeur received all placed number one overall in their respective Tiburon. Additionally, the Tucson received a score of a five star rating, top marks for safety in the National st classes. Located in San Diego, California, Strategic 99 in the 2005 1 half IQS performed from November Korean Customer Satisfaction Appraisement Highway Traffic Safety Administration’s (NHTSA) Vision was established in 1987. As a consumer to December 2004. The Tucson was the first ever In 2004 KCSI (Korean Customer Satisfaction Index) New Car Assessment Program (NCAP) for 2004. reliability rating organization, Strategic Vision vehicle to receive a double digit score in its first year survey, HMC achieved a ranking No.1 in the part of In addition, the Sonata received the top grade in developed the TVI to help consumers reach an of release in the North American market. IQS is a car and RV classes and have achieved 11 vehicle safety in a study conducted by the Korean informative purchasing decision. Results for the TVI study ranking the number of defects in vehicles; thus, successive years (1994~2004) of ranking No.1 in Ministry of Construction and Transportation in 2004. study are published annually. the lower the number, the less defects. customer satisfaction, in our country, since the time The Sonata received five stars in front and side KCSI survey was launched. KCSI is the first impact collision tests, the first for a Korean Consumer Reports Consumer Reports analyzes customer satisfaction index in our country which was automobile manufacturer. In brake performance and collects product data relating to consumer researched and announced by KMAC from 1992. tests, the Sonata recorded a breaking distance of preferences. From 1997 until 2004, Consumer It has been conducted against more than 100 44.9 m and 48.3 m in dry and wet road conditions. Reports had surveyed over 810 thousand vehicle industries and more than 1,000 companies to The Sonata also received a top mark of five stars in owners to analyze vehicle reliability. Consumer enhance the competitiveness of related industries the internal safety test that applies the same Reports selected HMC as the first Korean automobile and companies to improve problems in product and principles as the NCAP and NHTSA. HMC has company to register a higher than average ranking. service, and to protect the rights and interests of garnered the attention of numerous domestic and The New EF Sonata ranked 3rd overall in the mid-size consumers. overseas safety boards and is committed to segment and the Elantra, Accent, Santa Fe, and continuing R&D to develop safers vehicles. XG350 all received higher than average scores. Following the No.1 ranking in customer satisfaction obtained by HMC for July, 2004, it again achieved the No.1 ranking for September (KCSI). The New EF Sonata ranked first in J.D. Power’s IQS study for the entry mid-size segment in 2004

Vehicle Dynamic Control System, VDC Advanced Curtain Airbag System Management Environmentally Friendly Product Cleaner Production Communication with Stakeholders 64 65 Hyundai Motor Company / 2005 Sustainability Report

Motor Smart Card Service Advanced Safety Vehicle Customer Communication To improve overall vehicle safety and comfort HMC actively pursues the development of state of Customer Events standards, HMC has provided Motor Smart Card the art passive and active safety features. HMC’s HMC launches test-driving events for new vehicles Encompassing over one thousand participants each (MSC) services beginning from March 2005. passive safety initiatives include features protecting released for sale in the marketplace. year, the tournament is the largest of its kind in The MSC improves customer service through the drivers, passengers, and pedestrians though the use The opportunity for consumers to test-drive vehicle Korea. As well, HMC actively supports a wide array integration of vehicle management, maintenance, of seatbelts, impact-absorbing steering wheels and performance prior to purchase allows for improved of vehicle clubs, which are described in full detail on fueling, credit card and auto-insurance services. advanced pedestrian injury reduction hood systems. communications between HMC and customers. the HMC website. Such initiatives have been Active features include a Traction Control System HMC initiates various events ranging from a driving undertaken to enhance the communication channels (TCS), Anti-lock Brake System (ABS), a tire air school to an environmental field trip, and the as part of its continuing commitment to improve pressure sensor, a vehicle distance sensor along response has been positive. customer relations. with other brake related assistant systems to aid in driver maneuverability. For the newly released Sonata, 100 consumers were Manufacturing Plant Tours selected to participate in HMC’s comparability test HMC provides manufacturing plant tours to improve HMC plans to use active safety features to complete driving event held in 2004 as a means to improve the communication channels with consumers and the core technology in Advanced Safety Vehicle communication channels. The Sonata was tested other stakeholders. In 2004, visitors to the Ulsan (ASV). HMC also aims to improve comfort and against foreign competition, in design, reliability, manufacturing plant totaled 158,860 domestic and safety levels by adopting advanced safety features in handling, performance and safety. HMC had the 13,652 foreign nationals, a rise of 16% from the HMC’s full line-up. ASV is used to assist the driver opportunity to receive feedback about the Sonata previous year. The breakdown of foreign national

Providing comprehensive vehicle management service through MSC by enhancing perception and decision making, and directly from the 100 drivers who participated in the visitors is as follows; 1,636 North Americans, 5,875 by expanding the control operations of the driver. event. Asians, 114 Pacific Region visitors, 804 Middle Through joint services with the Smart Card Control HMC’s future development of ASV is expected to Easterners, 788 Europeans, 158 Africans, and 4, Unit (SCU), MSC’s informational service offers significantly reduce traffic congestion and accident As another means to promote customer 277 visitors from other regions. assessments regarding part replacement, vehicle rates, greatly improving the overall driving participation, HMC has been sponsoring the Getz malfunction and navigational information. All relevant experience. Recent developments of HMC’s ASV Summer Camp and the Getz Speed Festival since information can be accessed directly through the technologies have included a vehicle distance 2003. The Getz Speed Festival has garnered public MSC website. Expected to continue for 6 months sensor and a lane departure warning system. attention because it has been geared towards beginning from March 2005, HMC has initiated the enhancing the amateur racing culture of the general MSC demonstration project, which is to comprise of public and not racing professionals. ■ ASV Product Development 1,100 consumers from the Seoul metropolitan area. In addition, HMC sponsors the annual HMC Cup *MSC website : http://www.motorsmartcard.com Amateur Ski·Snowboard Tournament.

Lane Departure Warning System Demonstration Project Wu Bang Guo, President of the Standing of the National People’s Congress of HMC is conducting a demonstration project on its China, visited Ulsan plant lane departure warning system used in full size Customer Information Security Program commercial vehicle. Development of the system Customer information is managed according to commenced in 1998 and ended with the recent HMC’s internal customer information security completion of the technology. The system features a procedures, which sets limitations on accessibility. warning signal that goes off in the event the driver 1. Road Condition Sensor 12. Airbag 24. Collision Detection 2. Magnetic Sensor 13. Road-to-Vehicle/Vehicle- 25. Pedestrian Collision Each department using the information employs falls asleep at the wheel or the vehicle abruptly 3. Vehicle Distance Sensor to-Vehicle Injury Reduction information security personnel. Internal users are changes lanes. Recently, the system has been 4. Forward Obstacle Sensor 14. Rear View Camera Structure 5. Blind Spot Monitoring 15. Water Repelling Wind 26. Electronic Control required to receive approval from security personnel added to 18 express buses and 15 full size trucks as Camera Shield Steering 6. Drive Recorder 16. Seat-belt Pretensioner 27. Message Display System by submitting a customer information request form a trial run. In Korea, a driver falling asleep at the 7. Side Obstacle Sensor 17. Driver Monitoring Sensor Communication System 8. Air Pressure Sensor 18. Head-up Display 28. Hands-free System 2005 Getz Speed Festival before any information is obtained. In addition, wheel is a major cause of traffic accidents. Following 9. In-side Door Lock/Unlock 19. Steering Angle Sensor 20. Electronic Control *Getz Speed Festival website : http://www.clickfestival.com external users are required to sign a confidentiality the end of the project in July 2006, HMC plans for 10. Rear Obstacle Sensor 21. Electronic Control Brake Throttle Sensor 22. Fire Detection Sensor the full-scale implementation of the lane departure 11. GPS Sensor 23. Vehicl Speed, Acceleration Sensor warning system in all full size commercial vehicle. Management Environmentally Friendly Product Cleaner Production Communication with Stakeholders 66 67 Hyundai Motor Company / 2005 Sustainability Report

agreement, which must be notarized before any Sports Marketing customer information is issued. In completion of Cooperation and Development of World Through the official sponsorship of the Olympics and Automobile Industry contracted work, external users are required to the FIFA World Cup, HMC is helping to raise the return or dispose of any information and are Chairman and CEO Mong-koo Chung participated in the global image of Korea worldwide and is contributing TM opening ceremony of the 2004 Paris International Motor 2006 FIFA Worldcup in Germany requested to submit a customer information return Hyundai Motor Company Show along with French President Jacques Chirac and to the development of amateur and professional and a disposal confirmation form for approval. official partnership emblem the top executives from 13 global automobile companies. sports throughout the world. In addition, HMC has HMC requires customer information security Participants included the likes of GM CEO Rick Wagoner, also heavily supported the growth of domestic sports personnel and system operators to receive security Ford Chairman and CEO William Clay Ford, and through its continued sponsorship of marathons, and confidentiality training quarterly. In August DaimlerChrysler Chairman J rgen E. Schrempp. soccer events, and various other HMC hosted 2004, HMC adopted a Database Security System Leaders held discussions at the event regarding the events. To further the development of Korean industry’s prospects and agreed to promote cooperation Professional Football Club, (DSS) to enhance the current security level of soccer, HMC owns and operates the Chonbuk Chonbuk Hyundai official emblem and eco-friendly management within the automobile information. Hyundai Motors Football Club, and continues to industry. expand its support of sports such as archery. Internet Website Updates are continually made to HMC’s website in an effort to improve site usability. Improved web design, updates and the inclusion of more extensive content is initiated to satisfy the changing needs of customers. With the re-launching of its new and improved website in 2004, the HMC website focused on 3 sections; Owner’s Club, Automotive Museum, and Kid’s World. Owner’s Club, offering information and services ranging from vehicle maintenance to customer support, is a new Internet Euro 2004 sponsorship 2004 Hyundai Mini Football Match based customer relationship management service launched in an effort to improve HMC’s ongoing CEO’s of world automobile industry who were attending the opening ceremony of 2004 Paris International Motor Show Athens 2004 Olympics Games Sponsorship FIFA Partnership customer service efforts. New information on As an official sponsor of the Athens 2004 Olympic Games, HMC provided full support as a show of its commitment HMC’s history and on the automobile industry, Investors Relations HMC provided 500 vehicles including the Centennial to the to ensuring the success of the 2002 FIFA World Cup along with interactive services for children in the TM HMC received the Corporate Investor Relations (IR) Athens Organizing Committee for the Olympic Games Korea·Japan . As an official sponsor of the 2006 FIFA Kid’s World section can also be viewed on the TM Excellence Award for outstanding IR activities in (ATHOC). As part of its sports marketing promotional World Cup Germany , HMC continues its support updated website. promoting the interests of the corporation, shareholders, activities, HMC operated Hyundai Free Ride, a transportation through the sponsorship and planning of World Cup and investors from the Korea Investor Relations service that connected major locations in the city to Olympic related events. HMC became an official partner of FIFA in Association (KIRA). HMC periodically holds briefings for stadiums. Furthermore, special booths were raised next to March 2005 for all FIFA related sports events taking place investors on quarterly corporate performance to free bus stops to provide passengers with official Olympic from 2007 until 2014. Aside from this, the partnership is strengthen global IR efforts and to bolster HMC’s Games schedules, Athens city maps, local information to extend to the Women’s World Cup and the FIFA World corporate image. HMC updated and expanded its IR booklets and HMC brochures. Youth Championship. HMC’s partnership with FIFA website to allow for shareholders and investors viewing To showcase HMC’s environment management initiatives, shows our commitment to the sport of Football. As the and accessibility. the ATHOC was presented with Santa Fe Electric Vehicles most highly regarded sport in the world, the connection (EVs) and aluminum body Getzs for committee use as a will undoubtedly enhance HMC’s corporate image as a *IR website : http://ir.hyundai-motor.com show of support of the 2004 World Environmental Day. global automaker. Dealer Communication 32 executives and managers from HMC’s Chinese dealerships were provided with tours to the Ulsan manufacturing plant to discuss HMC’s growth in China along with the growing relationship with Korean management.

Redesigned HMC Internet Website

Hyundai Free Ride Service FIFA Partnership Signing Ceremony Management Environmentally Friendly Product Cleaner Production Communication with Stakeholders 68 69 Hyundai Motor Company / 2005 Sustainability Report

Aftermarket Service 24-Hour Emergency Vehicle Rescue Each service center takes great pride in providing Supporting Korean Archery Providing top quality service to customers, Service and Self-Maintenance Training cleaning services for all vehicles large and small, As archery has come to play in an important role in the improving working conditions for employees, and including simple services such as providing development of Korea’s image worldwide, HMC has Program minimizing environmental impacts are the carwashes. continued its support of the industry. Chairman and HMC operates a 24-Hour Emergency Vehicle fundamental building blocks of Green Service, one CEO Mong-koo Chung was appointed as the Rescue Service for customer safety and initiative in HMC’s aftermarket service sector. International Aftermarket Service chairman of the Korea Archery Association from 1985 convenience in partnership with volunteering local Offering special services for vehicles damaged by until 1997. He has since been named as the Honorary taxi drivers. HMC provides self-maintenance Enhancement Program Chairman of the association, and his financial support natural disasters is another part of providing public training program to promote safe driving practices HMC has developed programs to foster the training over the last 20 years has totaled 20 billion Korean service. From July to September 2004, HMC in and to enhance vehicle maintenance skills. of foreign aftermarket service mechanics, and Won. As such, medal winning archery athletes from association with Kia Motors and Hyundai Mobis Following the completion of the session, drivers service coordinators are to be introduced beginning the Athens 2004 Olympic Games were rewarded with organized a Natural Disaster Relief Task Force Team 400 million Korean Won along with 10 passenger learn how to manage their vehicles in emergency from 2005. To strengthen global brand image and to minimize damage resulting from floods and vehicles. In addition, he promotes the technological situations are educated on safe driving practices to improve customer satisfaction, high-caliber typhoons. The team consisted of 2,300 service advancements of domestic archery equipment through and are informed of how to drive their cars for better foreign aftermarket service personnel are invited to providers and staff from HMC service centers the sponsoring of research and development. fuel economy. participate in the enhancement program in Korea. throughout the country. Furthermore, HMC provides special vehicle inspection services for the physically challenged, residents of remote areas and drivers of delivery vehicles.

For prompt maintenance service, HMC focuses on four key areas. The service Manager System ensures the competency of services rendered from start to finish, and provides the speedy and efficient dispatch of service vehicles. Quick processing of technological information is ensured by the Hi-Tech Center and the One Plus System is offered to Chairman and CEO, Mong-koo Chung encouraged Korea provide maintenance services above and beyond Self-maintenance training for customer HMC overseas mechanic training program representative players the minimum requirements during service calls. BASIC Movement and Clean Service HMC has initiated the BASIC (Beautiful, Attractive, Safe service shop, Innovative, and Control) Movement to maintain cleaner working conditions and higher work efficiency. For efficient implementation, HMC standardized detailed service manuals that were distributed to all customer service centers. To promote the BASIC movement, HMC hosts the Best Mechanical Technology Innovation competition and related competitions annually. Selected technologies are then shared with

HMC’s free vehicle inspection service, One Plus system customer service centers throughout the country. Clean Service calls for the systematic inspection and cleaning of vehicles by service managers. Management Environmentally Friendly Product Cleaner Production Communication with Stakeholders 70 71 Hyundai Motor Company / 2005 Sustainability Report

Employee Human Resource Employee Training and Education Trust Based Management, Site Intensive employees, and to giving them job satisfaction and Human Resource Policy HMC provides systematic job training as well as Management, and Transparent Management are the equal opportunity. HMC has been systemizing HMC has established a progressive human resource higher educational opportunities. Training and three major elements, which are applied in HMC’s related support programs and training sessions for policy. Divided into three parts, the policy educational programs are designed to enhance the human resource management policy supported by its employees to attract professional talent and emphasizes a self-drive toward further learning, knowledge and skill of employees, and to improve the horizontal management initiatives. HMC is promote self-enhancement. creativity, and social service in all employees. their aptitude in completing given assignments. committed to looking after the well-being of its In addition, HMC provides the necessary tools for Talented employees showing potential are selected self-enhancement and the training to maximize for the Overseas OJT (MBA) and Study Abroad individual potential. programs. In 2004, HMC invested 24.5 billion Korean Won for training and education, which Number of Employees Female Employees amounted to an average of 108 man-hours per In 2004, 61,951 workers were employed in major domestic Since 2001, the number of female employed in the employee. In response to the global growth of the and overseas operations at HMC. To accelerate planning, marketing, PR, finance, sales, procurement, localization and globalization, HMC has been recruiting general management, and R&D departments have been company, training and education for overseas local talent in global major markets. steadily increasing. In 2004, the female employee base subsidiaries have been on the rise. totaled 2,193, or 4.1% of the total employee pool. Gender equality in employment and promotion are strictly ■ Training and Education in 2004 enforced at HMC. For the welfare of female employees, female workers receive an additional day of paid leave per month and are eligible for a 90-day maternity leave. In addition, HMC operates a day care center at the Ulsan manufacturing plant to aid young mothers.

■ Number of Domestic Employees Training and Education Programs In line with its corporate vision and strategy, HMC redesigns training and education programs every year. The programs are interlinked to create

*Source : 2004 Hyundai Motor Company Annual Report synergy and to maximize effectiveness. In addition, HR management tools are applied to evaluate the ■ Number of Female Employees effectiveness of its training and education programs. HMC takes a systematic approach to the training Working Conditions and education process as reviews are held to In 2004, the recorded average weekly working hours for a enhance the program and to re-evaluate production worker amounted to 33.5 hours and 16.5 performance. ■ Number of Domestic Employees overtime hours. Over-time working hours were subjected to payments that were 150-350% above regular hourly by Occupation ■ Training and Education Process wages.

Paid Leave Policy HMC’s collective bargaining agreement outlines paid leave and vacation policies in accordance to Korean Labor Laws. Providing 4 days of paid leave during the Korean New Year and Chuseok (Korean Thanksgiving) is stipulated as one part of the agreement. In addition, female employees receive an additional day of paid leave per month and 90 days for maternity leave.

■ Number of Overseas Employees Management Environmentally Friendly Product Cleaner Production Communication with Stakeholders 72 73 Hyundai Motor Company / 2005 Sustainability Report

Hyundai·Kia Education Center Education for Family Members Human Resource Management Human Rights The Hyundai·Kia Education Center is a HMC offers various continuous education programs Employee Welfare Programs Established in 2001, HMC’s Code of Conduct comprehensive system made available online. for the family members of employees. Some of the HMC provides its employees with various welfare ensures human rights to be one of the key elements Employees at HMC can access training and programs that are offered include Love Your Family, and benefit programs in accordance with the in all of HMC`s operations. HMC complies with all education programs, individual history, results & Respecting One’s Parents, Children’s Summer cultures and requirements of each region. In Korea, laws and regulations governing a specific region with summaries, education priorities, and applications Camps, and the Cyber Housewives’ College. HMC offers both regulatory and non-regulatory regards to human rights issues, and also operates with the system. HMC provides various family focused events to welfare programs. Regulatory welfare programs programs to promote human rights awareness such *Hyundai·Kia Education Center website : http://www.hkhrd.com emphasize family value and to provide long-term include health insurance, industrial accident as the Employee Grievance Remedy Committee cultural education programs. insurance, national pension fund, medical welfare along with the office of the ombudsman. Venture Plaza programs and employment insurance. HMC formalized the mechanism and offers various To promote and enhance R&D, HMC operates Non-regulatory welfare programs include subsidy of programs to rectify employee grievances. Venture Plaza. Venture Plaza supports the venture club operation costs, weekend trips to farms, out of companies from Hyundai Motor Group, and also Cyber Housewives’ College town retreats, and other related welfare programs. administrates high tech endeavors to develop HMC opened an educational website termed the environmentally friendly technological advancements Cyber Housewives’ College in January 2004. in safety and performance. Through the incubating The website offers 52 courses ranging from finance to computer studies. Mentor Programs for New Employees Labor Union and the Freedom of Association of high tech companies, HMC is initiating creative HMC assigns a mentor, similar to the Big Brother program, HMC complies with domestic and international labor- and aggressive technology development projects. to new employees for their first 6 months on the job. related laws and regulations guaranteeing the freedom *Venture Plaza website : http://www.hkventure.co.kr The program aims to help new employees become better of association. Domestically, all new employees are accustomed to their new surroundings and to resolve any required to join the labor union, with the exception of Research Paper Contest and Incentive for potential problems through peer networking. those exempt under the Korean Labor Standard Act and Invention Policy the Collective Labor Agreement. In overseas operations, the Labor-Management Association in HMI and BHMC’s To encourage employee research activities and the Cyber Audit Office and the Whistleblower Hotline Public Association are utilized as channels for sharing of knowledge, HMC hosts a research paper The Cyber Audit Office and the Whistleblower Hotline play a key role as HMC’s office of the ombudsman in ethics communication between the union and management. contest annually. Topics ranging from vehicle management. Upon receiving reports on unethical or performance enhancements to low emission unfair business practices, it orders corrective actions and Participating in Management from Indigenous producing eco-friendly vehicle technologies were *Cyber Housewives’ College website : http://hyundai-kia.cyberjubu.com conducts disciplinary training to prevent recurrences. Employees presented. In addition, HMC implements an With confidentiality policy on the report, corrective actions HMC encourages the recruitment of indigenous incentive for invention policy to encourage and conduct disciplinary training are ordered when employees in overseas operations. For instance, in the employees to develop new technologies and to Education Programs for Employees’ Children unethical or unfair business practices are reported. case of BHMC, three Chinese directors team with three further enhance product quality. New inventions A basic economics course is offered to broaden a Korean directors during HMC`s board of directors meeting. HMC’s global operations have implemented policies to that lead to a cost reduction or an improvement in child’s financial background. In addition, HMC Sexual Harassment Counseling Center provides children with various educational courses in hire people from the local area to ensure a diverse efficiency are reviewed by an HMC appointed panel In compliance with the Gender Equality Employment Act, computers, and Chinese and English language reflection of values in corporate decision-making activities. to determine the level of incentives. HMC operates a Sexual Harassment Counseling Center. during the summer vacation. Led by native and The center provides education on sexual harassment Korean instructors, 600 middle school students prevention to all HMC employees on a regular basis. Equal Opportunities Joint Education Programs (Grade 6 and 7) participated in the 4 sessions that HMC prohibits all forms of discrimination (ethnicity, age, Working with 7 domestic colleges, HMC has been were offered during the summer, ranging from Child Labor and Forced Labor religion, gender or nationality) in employment, job post conversation to composition classes. HMC provides operating the Joint Education Program for Child labor is prohibited at HMC. HMC adheres to all assignment, performance evaluation, training, and an online website outlining all education programs for employees since 2003. One of the objectives of this domestic and international laws regarding child labor. promotion. HMC recruits new employees by following employees’ children. program is to educate employees on new cutting In compliance to domestic and international laws and strict recruitment and screening standards. During their stay at the new employee camp, all recruits undergo a edge technologies. In January 2005, 180 *Education Programs for Employees’s Children website : regulations, HMC bans the employment of those below http://ilovehk.com series of consultations and interviews for job posting. employees obtained the necessary 84 credits the minimum legal age. In addition, all HMC employees HMC does not recognize performance evaluation and requirement to successfully achieve the completion join the company voluntarily. Indemnity for employee labor is regulated under HMC’s corporate wage policy, and recommendation for promotion other than what is of the course. At present, 181 employees are relevant laws and regulations. described in the standardized protocol. registered in the program. Management Environmentally Friendly Product Cleaner Production Communication with Stakeholders 74 75 Hyundai Motor Company / 2005 Sustainability Report

Industrial Health & Safety i-ESH System ■ i-ESH System Labor-Management Industrial Safety & Health Industrial Accidents The i-ESH system is a comprehensive information Committee In 2004, total registerable industrial accidents in and data management system. It collects information HMC’s Labor-Management Industrial Safety and HMC’s domestic operations, according to Korean related to environmental, safety and health issues Health Committee is co-managed by executive regulations, added up to 1,518; this number from the domestic plants. Data is recorded and management and the labor union. The purpose of included 8 fatalities (1 by accident, 6 by personal archived by the system for statistical purposes. this committee is to prevent industrial accidents and diseases, 1 by commutation) and 1,510 injuries or It is accessible by intranet and contains information to provide better workplace conditions for diseases. The total number of registerable industrial regarding relevant laws, technical standards, ESH employees. The Committee meets quarterly and is accidents increased despite our continued effort on FAQs and training materials. comprised of 7 executive managers, 7 members improving workers’ health and safety conditions. from the labor union and an honorary advisor. As part of going beyond compliance, HMC began ESH Training recognizing ergonomics symptoms as registerable HMC continues to improve environmental safety and Medical Examination industrial accidents from 2003. overall health conditions by providing ESH training to Medical examinations at HMC are broken down into its employees. At manufacturing plants, HMC two categories according to type of work. Industrial Accident Rate provides training in compliance to Korean laws as HMC office workers receive bi-annual medical ■ well as to its own ESH standards that go beyond check-ups and production workers are provided legal requirements. Divided into two sub-sections, with specially designed medical examination on a HMC offers specialized education for upper tier yearly basis. HMC became the first Korean managerial levels, which cover environmental corporation to offer traditional oriental medical management. For employees injured on the job, diagnosis treatment for employees. In addition, HMC provides rehabilitation programs to aid in employees over the age of 40 including family recovery. members are provided with a special medical examination. In partnership with Online-Med, Environmental Safety and Health Training employees are provided with various online medical services accessible through its corporate intranet Hyundai Motor continues its support for the betterment of the environment and safety and health conditions by system. providing various ESH training. At production sites, Hyundai Motor provides training in compliance to Korean law as well as its own training programs that go beyond legal requirements. The education program for employees for environmental safety was evaluated by the health department as an outstanding program. The programs for the employees upper managerial level cover ethical cyber training and environmental management training.

■ Safety & Health Training in Production Sites

Category Subjected Employee Type Training Hours Training Period Contents of Training Routine Production 2 Monthly Regulation, safety Training Office 1 Monthly Management protocol, other industrial safety related topics Managerial 16 Yearly Supervising for work safety New Employee General Work 8 Before Regulation, safety Training (i.e. machining and assembly) assignment management protocol, PPE, safety in work place Special Work 16 Before Safety awareness and (i.e. press and painting) assignment equipment safety, chemical safety, safety in work place Transferred General Work 2 In work scope Safety standard in Employee change work place, PPE, ergonomics Training Rotating Work 2 In work rotation The 11 Standard Safety & Health Commandments Special Work 16 In work scope Safety awareness and change equipment safety, chemical safety, safety in work place Management Environmentally Friendly Product Cleaner Production Communication with Stakeholders 76 77 Hyundai Motor Company / 2005 Sustainability Report

Supplier ■ SCEM Project The building of networks with technologically environment management strategies, and advanced and quality based suppliers, including establishing cleaner parts-production systems. environment management and transparent Since 2003, HMC has been providing training and management conformity are crucial in HMC’s drive educational sessions for employees of participating towards becoming a global leading company. suppliers. Using this as a base, the SCEM project To further partnerships, HMC supports suppliers on has developed into 4 branches; environment technology developments and various improvement management promotion, cleaner production plans. HMC supports the 236 suppliers registered systems, production of environmentally friendly with the Medium Enterprise Job Training Consortium products, and the implementation of integrated and actively provides training and education with 1st environment management systems. The project has and 2nd tier suppliers in the fields of technological been divided into a 3-year project, beginning from advancement and product quality enhancement. July of 2003 and ending in June of 2006. With a government grant and a company investment HMC HMC is also working to ensure environment has selected 40 experts to further develop the management and transparent management project. Already in the 2nd year of the 3-year project, conformity with suppliers. In May 2005, 690 not only has an environmental strategy been representatives from 355 suppliers and 480 HMC developed in 2005, but an overall improvement in employees participated in the HMC sponsored the manufacturing process has already lead to cost environment management education conference. reductions of 2.2 billion Korean Won and higher cost Sustainability, environmental strategy, and savings are expected before the end of the project. environmental policy and regulations were topics that were covered over 3 education sessions. Aside from these initiatives, HMC operates various systematic controls from support systems to ■ SCEM Organization educational programs to enhance the regulation of ethics management policies, and to encourage management reform and process innovation with suppliers.

Supply Chain Environmental Management In order to cope with the increasing level of regulations placed upon automobile industry from governments over the globe, HMC has been participating in the Supply Chain Environmental Management (SCEM) project since 2003. The project was initiated to increase global competitiveness through the establishment of an environmentally friendly supply chain management system, whereby suppliers would be supported in an effort to establish an environmental management strategy encompassing the entire chain of the business. Presently, the SCEM project involves 15 selected suppliers. Through the SCEM project, suppliers have been developing their SCEM Workshop SCEM Reporting Session Management Environmentally Friendly Product Cleaner Production Communication with Stakeholders 78 79 Hyundai Motor Company / 2005 Sustainability Report

Green Purchasing System VAATZ System Supplier Support Program HMC has been cooperating with suppliers to The Value Advanced Automotive Trade Zone In 2001, the Supplier Association of Kia Motors and 2,720 technicians for the following year. establish environmental management systems. (VAATZ) is HMC’s proprietary system for the HMC were merged together to establish an efficient Furthermore, HMC plans to invite technicians from As part of HMC’s management strategy and green transparent procurement of goods and services. inter-supplier collaboration system. Suppliers from 2nd tier suppliers as well. HMC is working closely purchasing system, we provide training to 450 The system directly links suppliers with HMC and both sides have been exchanging trade information, together with suppliers in an effort to improve suppliers on environmental management system. the entire transaction of purchasing and payment for developing new products and working on new product quality to world-class levels. This ongoing HMC is planning to improve the Five Star system parts is conducted entirely on-line through the technologies. Each year, HMC presents its business process begins at the very first stages of (a supplier quality evaluation system) to include VAATZ system. plans and provides seminars regarding its new development. Through the development of training further elements relating to environmental *VAATZ System website : www.vaatz.com management policy. Additionally, the association is programs and by working together with suppliers, performances as part of supplier selection criteria. offered many training sessions to improve product HMC is taking small steps forward to realizing this quality and environment management. Information goal. Ethics Charter of Purchasing Division regarding HMC’s technological advancements is offered to its suppliers, and HMC provides a guest Supplier Employees Support Center ■ Green Purchasing Plan Our goal is to improve the quality of life by engineering site at the Namyang R&D Center to help Improving human rights and the workplace developing and supporting environmentally suppliers in their R&D efforts. HMC established environment is an important part of HMC’s friendly products. Foundation of Korea Automotive Parts Industry sustainability initiatives. Since 2003, the We are pursuing mutual development with (KAP) in 2002 to focus on improving the relations procuremant division of has operated a Supplier domestic and foreign suppliers by creating and quality of parts developed by domestic Employee Support Center to offer assistance in the highest value through fair and transparent suppliers. Furthermore, several programs for A/S legal affairs, wage, welfare and unfair treatment. transaction. providers have been developed by HMC to improve The VAATZ purchasing portal site offers an online We aim to attain ethical transparent relations and to promote mutual understanding. suggestion board for supplier employees to submit management through responsible conduct. any comments and suggestions relating to any We endeavor to earn respect by creating a Medium Enterprise Training Consortium processes. The system ensures 100% transparent and fair purchasing culture, The Medium Enterprise Training Consortium is confidentiality. These suggestions are reviewed and respecting ourselves by maintaining our working with domestic suppliers to improve taken into account in order to improve HMC and dignity. competency and enhance talent recruiting activities. suppliers relations, which includes transparent Established in 2004, the consortium has been in management policies. place for a year. Of the 428 suppliers involved, 1,946 technicians have been chosen. 106 of those Technical Assistance for Supplier chosen were displaced into a two to three month Technical assistance for suppliers is one of HMC’s educational program that involved extensive training main initiatives. Working together with suppliers, all in automation, car maintenance and applied information pertaining to new product technology is engineering. The remaining 1,840 technicians were distributed by HMC to its suppliers. HMC also placed into three to four day training sessions that supports Venture Plaza, HMC’s internal venture involved workshops relating to car manufacturing, workgroup, which researches and develops new automation, cars and engineering. The program, technology. The outcomes of these R&D efforts are including accommodations and meals, is provided to shared with suppliers so that it reinforces HMC’s suppliers at HMC’s expense. Through the program, research competency and enhances suppliers’ HMC has created a win-win situation. As a result of technological proficiency. All efforts are being taken its success in 2004, HMC has introduced plans to to improve cooperation and to create a win-win increase the number of invitees by 40%, to a total of situation for both HMC and its suppliers. Management Environmentally Friendly Product Cleaner Production Communication with Stakeholders 80 81 Hyundai Motor Company / 2005 Sustainability Report

Social Contribution Social Contribution Council Social Contribution Activities To fulfill its commitment as a responsible corporate The Social Contribution Council is HMC’s governing Mobility for the Physically Challenged citizen, HMC continues to place emphasis on social body responsible for planning and designing social To enhance the mobility of the handicapped and the contribution activities. By providing monetary contribution action plans for each department. elderly, HMC is the first domestic automobile contributions and voluntary public services in Areas of the council’s social contributions include manufacturer to develop vehicles for the physically partnership with stakeholders, HMC is taking the social welfare, cultural events support, sporting challenged. The Sonata and the Trajet have been necessary steps to achieve this goal. HMC initiates events support, academic and education, specially equipped with factory-installed features for public interest marketing campaigns to help low- environmental protection, disaster relief, international the disabled to enhance mobility, HMC’s first step to income families, and works together with non-profit communications, and domestic development. meeting its initiatives in providing mobility services. organizations, such as the Beautiful Store, to raise In addition, HMC has set plans to commercialize ■ Social Contribution Area money through fundraising activities. HMC also low-deck buses with a deck height of 28cm or lower, offering easy accessibility for the physically provides relief funding and sends support staff to Employees voluntary public service local and international areas, which have been struck challenged. by natural disasters. In line with its commitments, HMC also continues its support of cultural and sporting events.

HMC’s social initiatives have been broken down into the following areas; the first focusing on providing mobility services for the physically challenged and the second dealing with traffic safety education. Initiatives to provide the low-income physically challenged and the elderly with wheelchairs, and to provide vehicles for the physically challenged allowing HMC’s social contribution internet website for better mobility have been initiated. Safety partnership programs include the traffic safety Presentation session of Trajet for the physically challenged education of children and support programs for Slogan and symbol for victims of traffic accidents. social contribution

Employees participate in volunteer activities throughout the year. HMC is comprised of 107 employee led volunteer groups, which play a central role in HMC’s volunteer commitments to aid the underprivileged. HMC plans to operate a social Society moving all together Invitational Events for the Physically Challenged contribution data management system to more As one aspect of volunteer services provided by efficiently systemize and organize the activities of Together | Emphasizing the partnership to keep harmony employees, the physically challenged are invited on with society as a corporate citizen each department. In addition, not only does HMC manufacturing plant tours and are invited to participate in Moving | Reflecting the features of automobile business, continue to donate monetary aid, plans to continue HMC sponsored sporting matches. In 2004, 600 and representing continuous changes providing public services in needed areas are in the 120 physically disabled persons were invited to tour the Society | Disseminating HMC’s social contribution Ulsan and Jeonju manufacturing plants respectively works. philosophy around the world through local associations for the physically challenged. Site tours and entertaining events were provided as part Sonata for the physically challenged of HMC’s humanitarian activities. As a part of its volunteer activities, HMC’s Ulsan Football Club held a friendly soccer match in June 2004. Students from a hearing impaired school located in the northern district of Ulsan city were invited to a friendly soccer match where donations were provided. In order to improve the living standards of the disabled, HMC plans to continue welfare programs, educational sessions and the sponsoring of friendly sporting events. Management Environmentally Friendly Product Cleaner Production Communication with Stakeholders 82 83 Hyundai Motor Company / 2005 Sustainability Report

Children’s Traffic Safety Social Contributions in Collaboration with Public Campaigning of Social Welfare Projects HMC engages in wide-ranging activities to educate Traffic Accident Prevention for the Physically Non-Governmental Organizations and to raise children’s overall level of awareness in Challenged Working in close association with Non-Governmental HMC provides the necessary support to various social welfare organizations to aid desolate groups, included in traffic safety. As well, HMC produces specially HMC supports the Community Chest of Korea by Organizations, HMC provides social events and which are the elderly living in solitude and foreign blue designed vehicles to enhance children’s safety. providing buses for educational purposes and financial activities in communities in response to its social collar workers, key groups relating to HMC’s social These efforts have been well received by related aid. Acknowledging that physically challenged children responsibilities. In March 2004, HMC launched its welfare cause. are at a higher risk of traffic accidents, HMC has boards and institutions. In addition to the initiatives annual blood donation campaign to help those who In May 2005, HMC announced its intention to launch a promoted traffic safety education. on children’s traffic safety, employees have also are in desperate need of blood services. public campaign in support of initiating social welfare engaged in a volunteer programs, providing The collection resulted in the donation of blood to programs in cooperation with various organizations. extracurricular sessions and preparing of meals for various Korean leukemia associations. Since May 2005, HMC has begun accepting potential underprivileged children. Furthermore, HMC and the Beautiful Store held a social welfare project proposals from various social fundraiser, Beautiful Saturday with Hyundai Motor in welfare organizations. Submitted proposals have reflected four main areas including social welfare March 2004. Over a period of two weeks, programs designed for the physically challenged, the employees donated over 60 thousand personal items elderly, adolescents, and local communities and to the store, which has been the highest recorded women’s associations. Final decisions regarding total thus far. HMC also donated 7 billion Korean approval were reached by an Admissions Board, which Won as a relief fund to the Community Chest of was comprised of a group of experts and professors. Korea and an amount of 1 billion Korean Won in relief In total, 22 programs have been granted approval for supplies to underprivileged neighborhoods at the end HMC funding and support since May 2005. A few of the selected proposals include programs to help in the of 2004. In order to help the underprivileged, HMC social adjustment of the physically challenged, programs was involved in a year-end social activity campaign to improve the daily living standards of the elderly living th lasting from December 6th to the 24 and distributed in remote areas, school violence prevention programs rice to 40 thousand low income and underprivileged and programs related to helping support the low-income Vehicle Designed for Children’s Safety families in partnership with the Taxi Driver elderly and foreign blue collar workers. HMC develops the H-1, a vehicle specially designed to Junior Traffic Safety Campaign Association. In addition, HMC contributes to social enhance children’s safety and accident prevention. The Three Leaf Clover Program Since 2002, the Junior Traffic Safety Campaign has Available on the market since July 2004, the H-1 is welfare facilities by donating used-computers Since April 2005, HMC has provided a Three Leaf Clover been undertaken in partnership with the Citizen’s specially equipped with an auxiliary side foot panel, annually. program to children who have lost their parents in fatal Coalition for Safety. The campaign has taken place a parking sensor, and a front detection mirror. nd th traffic accidents. The three Leaf Clover program closely every 2 and 4 Wednesday of the month, together Global Philanthropic Activities with parents and children in 25 different regions. resembles the Make-A-Wish Foundation program, a HMC is directly involved in international natural To participate in the campaign, registration is accepted wish granting organization for children. Individuals and online through the Citizen’s Coalition for Safety website disaster relief throughout the world and medical relief referred applicants register online directly at the HMC rd and/or in person at any one of HMC’s dealerships. support for Africa and other 3 world countries. social contribution website. All applications are reviewed Domestically, HMC is working with non-governmental twice by HMC staff and 10 to 20 children are selected organizations to provide medical services for foreign and granted with their wishes. In the future, HMC plans laborers working in Korea. to diversify this program to include the underprivileged. *Social contribution website : http://shareway.hyundai-motor.com

*Junior Traffic Safety Campaign website : http://www.safelife.or.kr and/or http://www.go119.org

‘Beautiful Saturday with Hyundai Motor’ co-hosted with Wheelchair donation for the physically challenged Food aid for the underprivileged Beautiful Shop Management Environmentally Friendly Product Cleaner Production Communication with Stakeholders 84 85 Hyundai Motor Company / 2005 Sustainability Report

Environment Restoration & Protection Attracting Talent Tsunami Relief in Southeast Asia HMC has been engaged in diverse environmental A major focus of HMC’s initiatives is the development Be Global Friends! In December 2004, Southeast Asia was hit by a protection activities to restore the local environment of future working professionals. In pursuit of this, The Be Global Friends HYUNDAI program supports tsunami causing great damage to the area. HMC in areas where HMC facilities are in operation. HMC provides the necessary support for students to students from domestic colleges and universities to offered $1.5 million USD in aid to the countries hit In 2004, Ulsan city presented Ecopolis Ulsan, develop and practically apply their education. HMC experience the international community. Each year, hardest by the tsunami by providing relief supplies and HMC reviews and selects a new region for the program initiatives to re-establish the city as an eco-friendly initiates wide-ranging educational programs in dispatching 5,000 volunteer workers. In addition, HMI to be held. Selected students are provided with the area. In line with and in support of the city’s support of university and college students studying in contributed $500 thousand USD in relief aid and opportunity to broaden their knowledge about the provided special services for damaged vehicles, and initiatives, the Ulsan manufacturing plant has begun professional programs. In addition, HMC gives chosen country’s history, culture, and economy. relief supplies totaling $700 thousand USD. Over 3,500 a 3-year project to protect the Sericinus telamon, an Korean students the opportunities to experience the employees from HMI and its dealers were also actively endangered butterfly, beginning from 2004. global community. involved in volunteer services in regions located in and The plant initiates a clean-up project for areas close around India. to rivers and beaches every year. Due to the destruction of forest landscape from forest fires, the Student Marketing Forum and Design Contest Donating Medical Vehicles to Africa plant in association with the local government and HMC hosts Korea’s largest annual Student Marketing HMC donated two H-1 Ambulances to the Korea secondary institutions has commenced a forestation Forum to advance fresh and creative ideas on automobile International Foundation for Health & Development to project on Mooryong Mountain. In addition, the marketing. In addition, HMC hosts a Vehicle Design support the public health development of Eritrea, one of Contest for students annually. The contest has received Asan and Jeonju manufacturing plants also the poorest countries in Africa. Public health much interest from students studying in engineering fields developments in Eritrea have been projected to begin undertake diverse protection activities to restore the and allows for the practical application of theories and somewhere between in 2004 and 2007. The first local environment. ideas. phase of the project is now underway and includes the reconstruction of old hospitals in Asmara, the capital of R&D Scholarship Program Eritrea. HMC has sponsored the R&D Scholarship Program to Supporting Eco-friendly Movement identify and nurture future leaders graduating from Supporting Domestic Foreign Laborers’ Medical HMC supports the National Trust of Korea’s eco-friendly engineering fields since 2003. HMC provides 4 billion Service rd Next Generation Vehicle Research Institute building enterprise. As part of its 3 public property Korean Won in scholarships and practical training sessions The number of foreign laborers working in Korea is a In June 2004, HMC established the Next Generation project, the National Trust of Korea has undertaken the on vehicle design, parts development, and vehicle staggering 140 thousand, with most not eligible to Vehicle Research Institute (NGVRI) at Seoul National complete residential redevelopment of Jaejang village, in assembly to 180 students annually. In 2004, HMC 137 receive medical insurance. This poses a special University to conduct research on futuristic vehicles and Kangwon Province. One of the distinctions of this project selected students have been receiving education at the problem as the majority of foreign laborers work in the to nurture R&D professionals. HMC plans to support is the replaced usage of concrete and chemicals with Namyang R&D Center and the Next Generation Vehicle 3D industries (Difficult, Dirty and Dangerous). the NGVRI’s faculties and R&D staff in its research of more environmentally friendly raw materials. Through its Research Institute (NGVRI) located in Seoul National In response, HMC contributed 600 million Korean Won next generation vehicle technologies and to share in its engagement of active employee participation in University. to the Community Chest of Korea for foreign workers’ residential projects since April 2005, HMC continues its findings. medical welfare as laborers are at a higher risk of support of the National Trust of Korea’s residential Mechanics Contest sustaining workplace accidents and contracting redevelopment initiatives. HMC has been working in close association with diseases. HMC’s contributions were used for medical automobile industries and academic institutions. welfare purposes and costs associated with child To nurture professional mechanics, HMC has hosted the rearing. Joint Mechanics Contest for students since 2001. Students from 11 engineering colleges and universities compete with fellow students to upgrade professional skills relating to repair and maintenance. The initiatives allow HMC to breed potential future leaders in the area of vehicle maintenance. By engaging in joint research relationships with these 11 schools, special HMC courses are now being offered to students of the Department of Automobile. In addition, HMC provides vehicles and other educational materials for the program and letters of recommendations to graduates. 86 87 Hyundai Motor Company / 2005 Sustainability Report

GRI Index

GRI GRI GRI GRI Reference Indicator Description Page Reference Indicator Description Page Reference Indicator Description Page Reference Indicator Description Page Number Number Number Number

Vision and Strategy 3.3 Expertise of board members 15 EN2. Waste material reuse 55 LA13. Cooperation with employee 1.1 Corporate sustainability vision 3.6 Sustainability management organization 13, 15, 81 EN3. Direct energy use 53 representatives 73 and strategy 8~9 3.7 Mission and value statements 8~9, 12~13 EN5. Water use 53 LA15. Agreements with employee 1.2 Statement from the CEO 2~5 3.8 Mechanism for shareholders to EN8. Greenhouse gas emissions 53 representatives on the health and safety 75 provide recommendations 15 EN10. Air emissions 57 LA16. Supporting continuous employability 71 Profile 3.9 Identification and selection of stakeholders 60 EN11. Total amount of waste 55 LA17. Life long education program 72 2.1 Name of reporting organization 6 3.10 Stakeholder consultation 60 EN12. Water discharge 58 HR1. Human right policy 73 2.2 Products and services 6, 36~37 3.11 Information from stakeholder consultation 83 EN13. Chemicals, oil spills 58 HR3. Supply chain management system 79 2.3 Corporate operational structure 15 3.12 Use of information from EN15. Product reclaimability 48 HR4. Preventing discrimination 73 2.4 Major divisions, subsidiaries, stakeholder consultation 83 EN16. Incidents of non-compliance 58 HR5. Freedom of association and and joint ventures 16, 90 3.13 Explanation of precautionary approach 32~33 EN17. Energy initiatives 47 collective bargaining 73 2.5 Countries of operation 16, 18~31, 90 3.14 Application of external sustainability EN18. Energy consumption footprint 46 HR6. Child labor 73 2.6 Nature of ownership 6 principles 46, 84 EN22. Water recycling and reuse 53 HR7. Forced labor 73 2.8 Corporate scale 6 3.16 Systems for managing upstream EN27. Ecosystem protection and restoration 84 HR8. Human right training 73 2.9 List of stakeholders 60 and downstream impacts 76~79 EN31. Hazardous material handling 58 HR9. Appeal practices 73 2.10 Contact point for the report 91 3.18 Operational decisions during EN33. Supplier performance 76~77 HR10. Non- retaliation policy 73 2.11 Reporting period 1 the reporting period 28~29 EN35. Environmental expenditures 59 HR12. Management of indigenous 2.12 Date of most recent previous report 1 3.19 Sustainability management program (Presented people's needs 73 throughout 2.13 Boundaries of report 1 the report) Social Performance SO1. Management of community impacts 27, 29

2.14 Significant changes in corporate 28~29 3.20 Certification status regarding LA1. Breakdown of workforce 70 SO2. Compliance mechanisms for anti-bribery 2.17 Decision to apply GRI Guidelines 1 sustainability management 59 LA2. Employment creation 70 and corruption 14~15 2.19 Measurement changes 55, 58 4.1 GRI content index 86~87 LA3. Union representation 73 SO4. Awards 61 2.20 Internal process ensuring reliability report 88 LA4. Communication with employees 70 SO7. Compliance mechanisms for 2.21 Independent assurance 89 Economic Performance LA5. Occupational accidents and diseases 75 anti-competitive trade practices 15 2.22 Additional information (Presented website EC1. Sales 6 LA6. Health and safety committee 75 PR1. Customer health and safety 63~64 addresses in the report) EC5. Total payroll and benefits 70, 73 LA7. Industrial health and safety 74~75 PR3. Customer privacy 65 EC13. Indirect economic impacts 35 LA9. Employee training and education 71 PR8. Customer satisfaction 61~63 Governance Structure and Management Systems LA10. Equal opportunity 73 3.1 Corporate governance structure 15 Environmental Performance LA11. Female employees and diversity indicator 70 3.2 Independence of Board of Directors 15 EN1. Material use 54 LA12. Employee benefits beyond legal mandates 73 Internal Process Ensuring the Independent Assurance

Reliability of the Report Independent Assurance Statement to Management of Hyundai Motor Company

Introduction Content from this report are based on input from stakeholders as well as from HMC’s business We have performed an assurance engagement on environmental and social aspects of the Hyundai Motor Company performances. The report was written by an internal team of the HMC Environmental 2005 Sustainability Report (hereinafter, the Report). The Report is the responsibility of Hyundai Motor Company, with Management Strategy Planning Team. The information presented follows HMC’s internal reporting whom the objective and terms of the engagement were agreed. We are responsible for expressing our conclusions guidelines and is based on official HMC documents and on information received from related based on the engagement. We have based our approach on emerging best practice for independent assurance on environmental and employees and departments. Contents are reviewed by managers and employees of related sustainability reporting, including ISAE 3000 (“Assurance Engagements other than Audits or Reviews of Historical departments and approved by the upper management of HMC before finalization and publishing. Financial Information”), issued by the International Auditing and Assurance Standards Board (IAASB).

Subject matter The subject matter is described as follows; 1. The process that Hyundai Motor Company at corporate level has put in place for the preparation of the Report, as described in the section, ‘Before you read.’ 2. The procedures and practices for the collection, calculation, aggregation and validation of performance figures for 2004 on environmental performance and industrial H&S and employee diversity as described in the section ‘Before you read,’ and whether such data collected in this way are appropriately reflected in the sections Cleaner Production (pages 52 to 59), Industrial Health & Safety (pages 74 to 75) and Stakeholders Communication (pages 60 to 85) in the Report. 3. Whether the above identified data, reported from Hyundai Motor Company production plants, are consistent with instructions from corporate level and with the source documentation supporting the submitted data.

Procedures Our objective was to achieve limited assurance. Based on an assessment of materiality and risk, we have gathered and evaluated evidence supporting the conformity with criteria for the subject matters described. This work included analytical procedures and interviews with management representatives and employees at Hyundai Motor Company Headquarters in Seoul and at four manufacturing plants (Ulsan, Jeonju, and Asan in Korea, and the Beijing manufacturing plant in China) and we engaged with the remaining two plants (Chennai, India; Izmit, Turkey) using various means of communication. Our work was performed on a sample basis, as we deemed necessary in the circumstance, but no substantial testing was undertaken. Therefore, the assurance that we obtained from our evidence gathering procedures is limited. We believe that our work provides an appropriate basis for our conclusion.

Results Based on our work described in this report, we conclude that nothing came to our attention that causes us not to believe that in all material respects; 1. Hyundai Motor Company has applied detailed and systematic methodologies and processes for the preparation of the Report in order to achieve its reporting objective. 2. Hyundai Motor Company at Headquarters level has applied detailed and systematic procedures for the purpose of collecting, calculating, aggregating, and validating performance data for 2004 on environmental performance, industrial H&S and employee diversity from reporting units for inclusion and appropriate reflection in the Report. 3. At the Korean production plants, the specified data submitted to Hyundai Motor Company Headquarters were consistent with instructions from Headquarters. Data were consistent with the source documentation presented to us. With respect to overseas plants in Chennai, India; Izmit, Turkey; and Beijing, China, instructions from Headquarters were not fully implemented. As a consequence, as mentioned in the Report, certain data from these plants were excluded from consolidation for 2004, and we have recommended improvements to be made for coming years. Hyundai Motor Company has made respective adjustments and commentary to the Report. Hereafter, those data were appropriately reflected in the Report.

Seoul, September 30, 2005 DELOITTE Statsautoriseret Revisionsaktieselskab

Preben J. Soerensen Danish State Authorized Public Accountant Environment & Sustainability Services Domestic Facilities Beijing Hyundai Motor Company (BHMC) Hyundai Motor Company Poland (HMP) Address: Room 601,Millennium Tower No.38 Address: Natpoll Building. No. 30, 4, Headquarters Xiaoyun Road,Chaoyang District, Beijing China Migdalowa Street, 02-796 Warsaw, Poland Yangjae-Dong Office Total plant site area of 670,000㎡ Total lot area: 22,177㎡ Hyundai Motor Hungary KFT (HMH) Production capacity: 150,000 Total floor space: 82,750 Address: H-1123 Budapest Alkotas U. 50, Hungary ㎡ Vehicles produced: Sonata, Elantra, Tucson Address: 231, Yangjae-Dong, Seocho-Gu, Hyundai Motor Norway AS (HMN) Seoul, 137-938, Korea Hyundai Assan Otomotive Sanayi (HAOS) Address: Ensjovn. 12D, Postboks 6466, Etterstad, Address: Sehit Mehmet Fatih Ongul Sk. No: 2, 34742 Kye-Dong Office (Domestic Business Division) 0605, Oslo, Norway Kozyatagi, Istanbul, Turkey Address: 140-2, Kye-Dong, Chongro-Gu, Total plant site area of 1,000,000㎡ Hyundai Motor Europe (HME) Seoul, 110-793, Korea Production capacity: 60,000 Address: Marie-Curie-Strasse 2, Vehicles produced: Accent, H-1, H100 65428 Russelsheim, Germany Ulsan Plant Division: No.1 Plant, No.2 Plant, No.3 Plant, Taganrog Automobile Plant (TagAZ) World Marketing Group (WMG) No.4 Plant, No.5 Plant, Address: 99, Halturinskiy, Rostov-on-don 344011, Russia Address: 4 Park Plaza Suite 950 Irvine, Total plant site area of 5,000,000㎡ Vehicles produced: Accent, Sonata CA 92614, U.S.A. Total floor space: 2,310,000㎡ Oriental-Hyundai Sdn Bhd Production capacity: 1,530,000 Hyundai Motor Finance Co. (HMFC) Address: Wisma Kah Motor, 2nd Floor, Hq A/C, Vehicles produced: Address: 10550 Talbert Avenue, Fountain Valley, Dept. No 566, Batu 3 1/2 Jalan Ipoh, 51200 *No.1 Plant- Accent, Getz CA 92728 0850, U.S.A. Kuala Lumpur Malaysia *No.2 Plant- Santa Fe, Centennial, Tucson Beijing Jingxian Motor Safeguard Vehicles produced: Accent, Elantra, Sonata *No.3 Plant- Elantra, Coupe, Matrix Service Co., Ltd *No.4 Plant- H-1, Trajet, H100 Truck, H-1 Truck Inokom Coporation Sdn Hbd Address: 18A Zhichun Road, Haidian *No.5 Plant- Terracan, Tucson Address: Lot38, Mukim Padang Meha, 9400 Padang District Beijing, China Address: 700 Yangjong-dong, Buk-gu, Ulsan, Korea Serai, Kulim Kedah Malaysia Vehicles produced: Atos, Matrix, Porter Hyundai Motor Company Asan Plant (Central & Eastern Europe Regional Headquarters) Total plant site area of 1,811,000㎡ Sudan Master Technology (SMT) Address: World Trade Center, Ent.3 #1902, Total floor space: 429,000㎡ Address: P.O. Box 444 Khartoum 11111, Sudan Krasnopresnenskaya nab.12, Production capacity: 290,000 Vehicles produced: Accent 123610 Moscow, Russia Vehicles produced: Sonata, Grandeur (Azera) Address: 123 Kumsong-ri, Inju-myun, Asan-si, Prima Engineering Industries S.A.E Hyundai Motor Company Chungchungnam-do, Korea Address: Egyptian Vehicle Manufacturing, (Asia Regional Headquarters) Ghabbour Km3 Cairo, Address: Level 5, Wisma Hong Leong, 18 Jalan Perak, Jeonju Plant Alex Agriculture Road, Egypt 50450, Kuala Lumpur, Malaysia Total plant site area of 990,000㎡ Vehicles produced: Accent Hyundai Motor Company Total floor space: 363,000㎡ Production capacity: 60,000 Hyundai Indonesia Motor (Africa & Middle East Regional Headquarters) Vehicles produced: Medium and large size buses, Address: Jl. Sultan Iskandar Muda No. Address: #2903, Api World Tower Sheikh Zayed Rd., medium and large size trucks, 81 Arteri Pondok Indah Lt 2 Jakarta P.O. Box 34406 Dubai, U.A.E. Selatan 12240, Indonesia special duty cars Hyundai Motor Company Vehicles produced: Atos, Accent, Trajet Address: 800 Yongam-ri, Bongdong-eup, (Central & South America Regional Headquarters) Wanju-gun, Jeollabuk-do, Korea Auhui Jianghuai Automotive Co., Ltd Address: 9250 NW 25th Street Miami, FL 33172 U.S.A. Address: 176, Donglim Road Hefei, China Hyundai & Kia Corporate R&D Division Hyundai Motor Company Vehicles produced: H-1 Address: 772-1, Changduk-dong, Hwasung-si, (Pacific Regional Headquarters) Kyunggi-do, Korea Huatai Automobile Co., Ltd Address: 8 Baywater Dr. Homebush Bay, NSW 2127 Address: No.1 Anyuan Li An Dingmen Wai Environmental Technology Research Center Chaoyang District, Beijing, China Hyundai & Kia China Regional Headquarters Address: Guseong-myun, Younging-si, Vehicles produced: Terracan Address: Room 1001, Hyundai Motor Tower, Kyunggi-do, Korea No. 38 Xiaoyun Road, Chaoyang Reyan Vehicle Manufacturing Co. (RVMCO) District Beijing, China Commercial Vehicle R&D Center Address: Sadaf Complex, Arg Vlvd., Address: 800 Yongam-ri, Bongdong-eup, Wanju-gun, Kerman Khodro Blvd. Km 16 Karadj Hyundai Motor Beijing Office Jeollabuk-do, Korea Special Road, Tehran, Iran Address: Room 701, Millennium Tower Vehicles produced: Accent NO.38 Xiaoyun Road,Chaoyang District, Overseas Facilities Beijing China (POST BOX NO.100027) Vietnam Motors Industry Coporation Hyundai - Kia America Technical Center Inc. (HATCI) Address: 120 Hang Trong, Hoan Kiem, Hanoi Vietnam Hyundai Washington Office Address: 5075 Venture Dr. Ann Arbor. Mi 48108, U.S.A. Vehicles produced: Porter, H100 Truck Address: 1660 L Street, NW, Suite 201, Washington DC 20036 U.S.A. Hyundai - Kia California Design & Technical Center Dewan Farooque Motors Ltd (HKMDTC) Address: Dewan City, Sujawal, District Thatta Hyundai Detroit Office Address: 81 Bunsen Irvine. CA 92608, U.S.A. Vehicles produced: Atos, H100 Truck Address: Hyundai Kia Motor Company 41850 W. 11 Mile Road Ste 110 Novi, MI 48375 Hyundai Motor Europe Technical Center GmbH MMC Automotriz S.A. (HME R&D) Address: Caracas, Venezuela Hyundai Motor Company Hanoi Office Address: Marie-Curie-Strasse 2, 65428 Russelsheim, Vehicles produced: Accent, Elantra Address: Suite 1004, 10th, Hanoi Central Office Building, Germany 44B Ly Thuong Kiet Street, Hanoi, Vietnam Sanyang Industry Co.,Ltd Hyundai Motor Japan R&D Center (HMJ R&D) Address: 3 Chunghua Road, Hukou Hsinchu Address: 3-2-2 Nishinohara Inzai-City,Chiba, Taiwan R.O.C Japan #270-1334 Vehicles produced: XG, Elantra, Tucson, Getz, Matrix Hyundai Motor Manufacturing Alabama (HMMA) Address: 7515 Halcyon Summit Dr. Montgomery Hyundai Motor America (HMA) Alabama 36117, U.S.A. Address: 10550 Talbert Avenue, P.O. Box 20850, Total plant site area of 6,900,000㎡ Fountain Valley, CA 92728 0850, U.S.A. Production capacity: 300,000 Vehicles produced: 2005 Sonata, New SUV Hyundai Auto Canada (HAC) Contact Information Address: 75 Frontenac Drive, Markham, Environmental Management Strategy Planning Team Hyundai Motor India (HMI) Ontario L3R 6H2, Canada Address: A-30, Mohan Co-Operative Industrial Area, TEL : 82-2-3464-2015 FAX : 82-2-3464-8796 Hyundai Motor Company Australia (HMCA) Phase-1 Mathura Road, Address: 8 Baywater Dr. Homebush Bay, NSW 2127 Mail : 231 Yangjea-Dong, Seocho-Gu New Delhi 110-044, India Seoul, Republic of Korea (137-938) Total plant site area of 2,148,000㎡ Hyundai Motor Japan (HMJ) Production capacity: 250,000 Address: Shuwa Sanbancho Building 2F 28 e-mail : [email protected] Vehicles produced: Atos Prime, Elantra, Sonata Sanbancho Chiyoda-Ku, Tokyo Website : www.hyundai-motor.com