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Storm destroys Hyundai parts depot

Weather the storm: Although a parts warehouse was destroyed in a freak storm, Hyundai says it will not effect customers.

Business as usual for Hyundai despite $2.5m parts wipe out

8 May 2015

HYUNDAI'S main parts stockpile has been wiped out by a freak hail storm that struck Sydney's west late last month.

The unprecedented weather event pelted the western suburbs with 10-20cm of rain and hail on the afternoon of April 25, destroying at least four warehouses in the Eastern Creek area, including the Korean manufacturer's Mobis facility.

No one was injured when the 30,000m² warehouse collapsed under the weight of hail and water, but the entire spare parts cache is expected to be written off, totaling a value of about $2.5 million.

Despite the significant disruption to Hyundai's local parts and service network, the company expects the loss to have little effect on its customers with a contingency plan activated immediately following the incident.

The company's disaster plan involves the rapid dispatch of replacement stock from Korea via sea with critical parts coming via air freight. The contingency also relies on flexibility in the local parts infrastructure to reallocate resources as required, as well as the rapid acquisition of a replacement facility.

Hyundai Motor Company Australia general manager of public relations Bill Thomas told GoAuto the warehouse collapse had posed a huge challenge for the company, but a contingency for exactly these circumstances was proving effective.

“It's been really interesting seeing the emergency plan go into action,” he said. “We found a new warehouse and I think there are 176 containers arriving early next week.

“Hyundai was amazing. They've got more stuff on the water coming and we've got quite a lot in dealerships – they tend to keep about 30 days of stock.”

Mr Thomas explained that in addition to the loss of tangible resources, the collapse of the warehouse had also shut down their supply-chain management network, but the the team had reacted quickly to reestablish the system.

“Part of the big problem was IT because all of the systems went down, but we were able to operate from here (Hyundai's Sydney head office) and make sure all the parts got sent to the right places. It was quite a challenge but it looks like it's under control.”

While the parts facility loss has had an impact on Hyundai's local operations, Mr Thomas says customers will “not greatly” feel the effects.

“I think there will be possibly some delays but we're able to see them on the system and advise customers if there will be delays, but at the moment it's pretty much taken up by the slack in the system,” he said.

HMCA chief operating officer John Elsworth said he was impressed with the team's response to the catastrophe.

“A freak occurrence of this magnitude inevitably tests the professional capabilities of our staff to the limit,” he said. “In this case, under intense pressure, the response has been nothing short of brilliant“The parts and aftersales teams at Hyundai Motor Company Australia and our sister company Hyundai Mobis have been working all hours to ensure customers are not affected by what is a massive and unexpected disruption.

“I couldn’t be more impressed with the speed, organisation and sheer energy of the response – thanks to the hard work of our aftersales staff, it’s likely that very few customers will experience delays.”

The parts facility loss will not delay deliveries of new Hyundai vehicles, but the company reports some accessories may not be available at the time of hand-over.

At least three other warehouses were lost in the freak storm with the total damage bill estimated at about $80m and as much as 100,000m² of storage effected.

Other businesses hit by the weather event consist of supermarkets, transport logistics and courier services.

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