Hyundai Motor to invest W12tr, Hynix W3.4tr following Samsung’s W43tr
The country’s large firms are unveiling their big investment plans for this year, hinting that many of them will take a more aggressive stance in expectation of a recovery in global demand.
This week, a number of big firms and conglomerates, such as Hyundai Motor Group, LG, Samsung and Hynix Semiconductor, announced their larger investment and hiring schemes for 2011.
Hyundai Motor Group chairman Chung Mong-koo (left) and SK Group chairman Chey Tae-won shake hands at the Korea Chamber of Commerce and Industry’s New Year’s event for business leaders at the COEX exhibition center in Seoul on Wednesday. (Chung Hee-cho/The Korea Herald)
“Uncertainties surrounding the global economy still remain, but this year’s key phrase is the pursuance of aggressive management strategy through the execution of large investments,” said an industry source. “It’s more likely that other large businesses will announce their large investment portfolios, following those of Samsung and LG.”
Hynix Semiconductor Inc. officially announced on Thursday that it plans to invest 3.4 trillion won ($3.03 billion) on facilities for this year.
More than 2 trillion won will be injected in Dynamic random access memory, or DRAM, and about 1 trillion won will be invested for NAND Flash memory, according to company officials.
Although the company said it will be flexible when deciding the total investment figure depending on the market situation, industry sources say that more information and technology firms planning on making larger investments on AMOLED displays and the non-memory chip market is projected to grow.
Hyundai Motor Group, the nation’s No. 2 conglomerate following Samsung Group, also said on Wednesday that it will invest about 12 trillion won this year, up 15 percent from 10.5 trillion won in 2010.
It also said that it will newly hire more than 6,000 workers, but did not state the details of the investment and employment plans.
The group’s chairman Chung Mong-koo has announced during his New Year’s address that it targets 6.33 million units in annual sales and aims to boost investment in developing eco-friendly automotive technologies for this year.
Samsung Group also scaled up its 2011 investment to a record 43.1 trillion to consolidate its global leadership in electronics and shore up its charge into growing fields.
The group states that it would employ up to 25,000 new workers, up from 22,500 last year to create more workplaces and lower the nation’s unemployment rate.
About 29.9 trillion won will be spent on facilities, 12.1 trillion won used for research and development and the remaining 1.1 trillion won is allotted for capital increase of overseas branches and stock investment to secure overseas resources for its affiliates.
Samsung’s rival LG Group, the fourth-largest business group, announced last month the largest-ever investment portfolio of 21 trillion won ― 16.3 trillion won on facilities and 4.7 trillion won on research and development ― for 2011.
Noted to be an 11.7 percent increase from last year, it is the first time ever for the group to invest more than 20 trillion won in a single year.
The announcement took place shortly after LG chairman Koo Bon-moo said this month that the group must quickly prepare for the future and that it needs to make timely investment in new growth engines.
SK Group, on the other hand, has not yet revealed its investment or employment plan, but it is reportedly making preparations to transform into a global company. An aggressive plan is expected, as the group recorded more than 100 trillion won in annual sales for 2010.
Lotte Group is planning to allocate up to 5.5 trillion won in local and overseas facility investments, which is a 30-percent increase, while leading steelmaker POSCO will announce its specific investment scheme during a CEO forum headed by its chairman Chung Joon-yang next week.
By Cho Ji-hyun (email@example.com