'Samsung not strong enough to ignore Japan'

'Samsung not strong enough to ignore Japan'

Lee Kun-hee, chairman of Samsung Electronics, said yesterday that the Korean electronics giant still has much to learn from its Japanese rivals, despite the waning influence of the island’s industrial icons, such as Sony and Toyota -- which were once role models for Koreans firms.


Samsung, once an also-ran to Japanese electronics manufacturers, has overtaken its Japanese rivals in the TV and handset markets for the past few years, and further widened the gap during the latest global economic downturn.

“Samsung has been improving for the past several years, but it has a lot to learn from Japanese companies,” Lee was quoted as saying in a meeting with Hiromasa Yonekura, new chairman of the Japan Business Federation, on Tuesday. Hiromasa, president of Sumitomo Chemical Co., visited Seongjiwon, Lee’s private office at his home in Hannamdong, central Seoul.

He also voiced the need for cooperation between Korea, Japan and China, citing their strength in manufacturing and growth potential.

“I think there are a lot of areas where Korean and Japanese firms can cooperate,” he said.

The private sector needs to take the lead (in the cooperation of the three Northeast Asian countries),” he said.
This is his first official activity since he returned to the helm of Samsung Electronics, the flagship unit of Korea’s top conglomerate Samsung Group, on March 24. He left for Europe yesterday to campaign for Korea’s bid to host the 2014 Winter Olympics in its eastern city of PyeonChang. Lee, a member of the International Olympics Committee, plans to meet other IOC members in Switzerland and Italy, and plans to come back to Korea around the end of April.

Lee received a suspended jail term and a fine of 110 billion won ($98 million) for breach of trust in August. The government granted a special presidential amnesty, saying it hopes Lee would rally support for PyeongChang’s third bid to host the Winter Olympics.

Lee subsequently came back to Samsung Electronics, citing the crisis facing the Korean electronics giant. The massive recalls of Toyota have been a wake-up call for Lee, accelerating his return to Samsung’s top job, a Samsung Group spokesperson said.

The massive recalls of Toyota cars have spurred Samsung Electronics and other affiliates of Samsung Group to examine their global operations to see whether a quality management system is in place, the Samsung spokesperson said.

Chung Ki-yong, president of Samsung Economic Research Institute, also yesterday gave a presentation on “lessons learned from the Toyota crisis, in a weekly meeting of chief executives of Samsung Group affiliates.

One of the major factors for Toyota’s problems is its overseas production. Recognizing this, Samsung Electronics said it has maintained the quality of its handsets made overseas similar to those in Korea, and the company is trying to secure ‘absolute quality’ in areas regarding handset safety.

Some Samsung affiliates have a system in place to enable them to check defects in products made globally in real-time, the spokesperson said

POSCO tops steel industry review

POSCO tops steel industry review

The steelmaker POSCO announced yesterday that it was named the world’s most competitive steelmaker by the leading steel industry analysis organization World Steel Dynamics.


POSCO, the world’s fourth largest steelmaker, said that the World Steel Dynamics’s analysis of 23 categories including technological capabilities and profitability showed the company to be the most competitive among the 32 steelmakers included in the review.

POSCO had maintained the top spot in the review from 2002 until 2004, but has been kept off the spot by Indian and Russian steelmakers until this year.

Samsung 3-D TV sales top 10,000

Samsung 3-D TV sales top 10,000

Samsung Electronics, the world’s top TV maker, said yesterday that it sold more than 10,000 units of its full HD 3-D LED TV in Korea, six weeks after its launch.


Sales of Samsung’s LED TVs reached 8,200 units for the first six weeks of the launch last year.

Samsung cited its technology of converting 2-D content to 3-D as one of the major reasons for the popularity of its 3-D TV models

Hyundai Steel vies for position with new steelworks

Hyundai Steel vies for position with new steelworks

Hyundai Steel, the nation’s second-biggest steelmaker, launched a new integrated steelworks powered by eco-friendly technologies yesterday to meet growing demand for automobiles and construction.


The Hyundai Kia Automotive Group affiliate began work on the 6.23 trillion won ($5.54 billion) plant in Dangjin South Chungcheong Province in October 2006. A blast furnace, the first of the two planned for the plant, was fired up in January.

"Today we are at the site of the new beginning of Korea’s steel industry,” President Lee Myung-bak said at the event.

“Due to the unprecedented financial crisis, many companies held back investment, but Hyundai Steel went ahead with daring investment plans, making today possible.”

The president was among the 2,500 government and industry leaders including Roger Agnelli, chief executive of the Brazilian mining firm Vale, and Alberto Calderon, chief commercial officer of the Australian mining firm BHP Billiton attending the ceremony.

“The Dangjin integrated steelworks was built with the aim of becoming a ‘green steelworks’ equipped with world class eco-friendly facilities and technologies,” Hyundai Kia Automotive Group chairman Chung Mong-koo said at the ceremony.

The Dangjin plant is the world’s first to be equipped with enclosed storage for raw materials to prevent the spread of dust, which is one of the more problematic pollutants associated with steel mills, according to the company.

“With the completion of the plant, Hyundai Kia Automotive Group is able to complete the world’s first ‘resource circulating business structure’ that goes from molten iron to automobiles.”

Under the resource circulating business structure, steel produced at the Dangjin plant will be processed by Hyundai Hysco into cold-rolled products, which will then be used in Hyundai Motor Co. and Kia Motors Corp.’s vehicles.

The steel from scrapped vehicles will then be melted down at Hyundai Steel’s electric blast furnace and used to produce construction materials, which will be used by the group’s construction firm Amco.

The plant currently has an annual production capacity of 4 million metric tons, but the figure will be raised to 8 million tons following the completion of the second blast furnace in November. In addition, the company plans to add another 4 million ton capacity blast furnace to the Dangjin facility at a later date.

Pilot operations of the second blast furnace are scheduled for the final two months of the year, and full operation is set to begin in January 2011.

“Of the 8 million ton output, 6.5 million tons will be used for hot rolling with automobile plates being the main product. The rest will be used to produce thick plates, mainly ship plates,” executive vice president Oh Myung-suk said.

“We have completed developing 104 of the 120 hot-rolled products we plan to develop by 2012. The company will also develop exterior automobile plates by the end of the year.”

He added that the company currently has a 400-person research and development team including personnel from the group’s carmakers, and that the steelmaker is planning to expand research facilities.

The new plant also significantly increases Hyundai Steel’s production capacity, making it one of the world’s top 15 steelmakers in terms of production.

According to the World Steel Association, Hyundai Steel was the world’s 30th largest steelmaker in 2008 with an annual output of 9.9 million metric tons in that year.

Including the company’s 11.5 million ton production capacity from electric blast furnaces, the addition of the second blast furnace will push up Hyundai Steel’s annual production capacity to 19.5 million tons.

“The company is changing from a down stream process to an up stream process. The significant thing is that the company’s profit structure is changing,” said SK Securities Co. analyst Lee Won-jae.

“As you move up stream, the profit margin increases. An electric blast furnace provides between 5 percent and 10 percent profit margin, but what POSCO is doing allows 15 percent to 20 percent profit margins when conditions are good.”

However, Lee said that moving upstream in the steel industry is not without its risks.

“There are some investors who think that the new plant is risky because it is a venture into a new area and the market is concerned about raw material prices.” he said.

“For about 40 years, steel raw material prices were set annually, but now they will be decided in quarters. POSCO is likely to raise prices soon, but the concerns are whether the increase in costs can be reflected sufficiently in product prices and for Hyundai Steel the worries are amplified as the company is new to the market.”

Korea ranks 15th in green efforts among OECD members

Korea ranks 15th in green efforts among OECD members
　The nation’s effort to promote low-carbon and green growth ranked 15th among the members of the Organization for Economic Cooperation and Development, said a report released by a state-run think tank on Thursday.

　The Science and Technology Policy Institute said the findings are based on an evaluation system which calculates the resolve of the government and its systematic support. It also considers setting up of a low carbon paradigm that is accepted by the public.

　The review system, which broadly examines multiple data -- such as policy resolve, a support process and the results of green growth endeavors -- said Korea ranked 14th out of a total of 30 OECD member nations in the input category.

　Germany recorded the highest in this field, followed by Sweden and Australia, it said.

　Involving support – covering the benefits for firms striving for eco-friendly growth -- Seoul was 18th. The country was ranked 17th in terms of output.

　Denmark ranked first in the process evaluation scheme, with Luxembourg finishing at the top on results attained by green growth policies.

　The institute, affiliated with the education and science ministry, said Switzerland scored best among the 30 OECD member countries in the overall evaluation scheme, with Sweden and Denmark making the top five. Germany and France ranked fourth and fifth, respectively. Japan came in eighth and the United States finished 26th.