Category: Korea-Business

Another American fast food restaurant chain is coming to South Korea.  It will be interesting to see if Dairy Queen puts a Korean twist on to any of their food offerings:

The U.S. fast food chain Dairy Queen has signed on to expand into South Korea, industry officials said Thursday.

M2G USA Investment said it has signed an agreement with International Dairy Queen Inc., which owns the franchise, to open 50 DQ Grill & Chill stores here over the next five years.

International Dairy Queen is a subsidiary of Berkshire Hathaway led by famous investor Warren Buffet. Dairy Queen, commonly known as DQ, is a chain of fast food restaurants serving hamburgers, ice cream and other frozen products, with some 6,000 locations worldwide.

A Korean foodservice company Food and Treat will handle operations of the local DQ locations.  [Yonhap]

For South Korea’s Samsung, 2016 was an explosive year. Literally. https://t.co/rtflTa81V3

— Scott Snyder (@snydersas) December 20, 2016

I have always thought that South Korea is an ideal location for electric cars to be sold considering the short distances that are driven in the country:

GM Korea, poised to launch the fully electric car Chevrolet Bolt EV early next year in Korea, confirmed Tuesday with the Ministry of Environment that its vehicle can travel 383 kilometers (239 miles) per charge.

It can now drive the longest distance with one full charge among the vehicles set to debut next year.

“Bolt EV is able to travel from Seoul to Busan with one charge,” said James Kim, president and CEO of GM Korea. “It is going to change the paradigm of Korea’s EV market.”

The retail price has not been revealed. Its U.S. price is an estimated $37,500 before tax incentives. [Joong Ang Ilbo]

You can read more at the link.

This will be a big change for the job hiring process in South Korea if this bill gets implemented, but it seems that face to face interviews will be the way for employers to get around the intent of this bill:

The South Korean parliament’s labor committee on Monday approved a bill which bans employers from requiring job seekers to provide a headshot and information such as their weight and height.

It also seeks to prohibit the “discriminatory” practice of requiring information about an applicant’s birthplace, religion, marital status, assets and family details on application forms.

Violators will be slapped with fines of up to 5 million won (US$4,275) under the bill proposed by Rep. Han Jeoung-ae of the main opposition Democratic Party.

The proposal calls for punishing acts of requesting and offering illegal favors, exerting undue influence and giving and taking gifts or cash in the recruitment process with fines of up to 30 million won.  [Yonhap]

You can read more at the link.

This is probably a good decision because I can’t remember the last time I remember seeing a Grandeur on the road in the US:

Hyundai Motor Co. is considering suspending the sales of the Grandeur sedan, exported under the name Azera, in the United States, industry sources said Sunday, due to its sluggish sales there.

While Hyundai announced the launch of the sixth-generation Grandeur earlier in November, sources said the company would not introduce the model in the U.S. If South Korea’s top automaker makes that decision, it would mark the first time in 16 years for the Azera to leave the U.S. market.

Industry watchers said although the Grandeur stands as a major high-end sedan in the South Korean market, it failed to grab enough attention in the North American market, losing out to the popular Sonata and the premium Genesis models.  [Yonhap]

You can read more at the link.

I don’t see how South Korea can be considered a low cost manufacturing country especially considering the KORUS FTA has made it cheaper for them to manufacture in the US compared to South Korea:

Trump hasn’t spelled out how he wants to rearrange NAFTA, but the basic idea is to encourage or compel more production in the United States, which would mean less production in places like Mexico. But that would be highly disruptive and would penalize American automakers more than their foreign rivals. Trump could probably rewrite the rules in a way that limits Mexican imports to the United States, for instance. But that doesn’t mean automakers would simply move Mexican factories north of the border. They might look for other low-cost countries instead, such as South Korea, India or China. The Trump administration could pursue trade restrictions on those countries as well, but that becomes a game of free-trade whack-a-mole in which the government is trying to tell multinational companies where to invest their money—hardly the lightly regulated pro-growth environment Trump says he wants to create.

If Trump tries to stop US automakers from producing in Mexico, that doesn’t mean he can stop foreign automakers from operating there. So the government would essentially be raising costs for American firms by forcing them out of Mexico, but not for their global competitors.  [Yahoo Finance]

You can read more at the link.

I can’t remember anything like this happening before with a major manufacturer stopping production of an electronic device due to safety reasons:

Samsung has permanently halted production and sales of its Galaxy Note 7 smartphone after failing to correct a problem that was causing the devices to burst into flames.

The loss of one of its flagship smartphones is a major embarrassment for Samsung , which was forced to recall 2.5 million Note 7s shortly after the device went on sale in August.

The South Korean firm attempted to fix the problem by switching battery suppliers and updating the smartphone’s software. Company executives issued a slew of apologies.

But when replacement phones were issued, a number of customers reported that those devices also caught fire, including one aboard a passenger jet.

Samsung on Monday advised all customers to stop using the phones, sending its shares tumbling by 8% in Seoul. The world’s biggest smartphone maker said Tuesday it was killing off the phone entirely.  [CNN]

You can read more at the link.

Here is the latest on the Apple versus Samsung copyright battle:

Overturning an earlier decision, a U.S. appeals court on Friday reinstated a lower-court verdict that Samsung Electronics pay Apple US$120 million for violating three iPhone patents.

In February, a three-member panel of the U.S. Court of Appeals for the Federal Circuit in Washington ruled that Samsung did not infringe upon the patents on “quick links,” “slide-to-unlock” and “auto-correct” technologies, and therefore does not need to pay $120 million ordered by a lower court.

Apple appealed that decision, arguing that the panel relied on extra-record evidence “none of which, it said, was of record and that the panel appears to have located only through independent research,” according to court records.

On Friday, a full panel of judges at the same court accepted Apple’s appeal in a 8-3 decision.  [Yonhap]

You can read the rest at the link, but for Apple the $120 million is probably enough to pay their lawyer fees considering how long this fight has been going on.

Here is an update on the Hanjin Shipping bankruptcy, the Korean government is trying to get Hanjin’s former chairwoman to cough up more personal funds to help cover some of the bankruptcy costs:

Choi Eun-young, former chairwoman of Hanjin Shipping, refused at a parliamentary hearing late Tuesday to cough up additional funds from her personal assets to help save the world’s seventh-largest container carrier.

On Sept. 12, Choi vowed to provide 10 billion won ($9.1 million) in private funds to cash-strapped Hanjin help tide the company over during the ongoing crisis. She knelt in front of lawmakers at the hearing at the Sejong Government Complex Tuesday, when Park Wan-joo, a lawmaker with the opposition Minjoo Party, berated her.

“You dragged up Hanjin Shipping’s debt ratio from 155 percent to 1,445 percent during your term and now you are saying you cannot donate your own assets because [Hanjin Group] Chairman Cho Yang-ho has been in charge since 2014?” Park asked. “Do you think you have served your responsibility? You are supposed to be sincere when making apologies.”

“I am sorry if I appear I am not properly apologizing. I apologize from the bottom of my heart,” she said, falling to her knees and sobbing with her head down for half a minute. “But [coughing up more of my fortune] would be difficult because it may wreak havoc with the management of Eusu Holdings.”

She currently is chairwoman of Eusu Holdings, which was split when she gave up oversight of Hanjin Shipping in May 2014.  [Joong Ang Ilbo]

You can read more at the link, but according to the article she is worth anywhere from $40-$180 million dollars.

Further reading:

https://www.rokdrop.net/2016/09/should-korean-government-bailout-hanjin-shipping/

https://twitter.com/geoffrey_cain/status/772958590965456896