Major Companies Offer Bullish 2010 Prospects
By Kim Yoo-chul
Staff Reporter
After spending an apprehensive 2009, Korea's leading exporters are optimistic on their chances of seeing huge profits in the New Year.
Many of the country's blue-chip companies, including Samsung Group, POSCO, Hyundai-Kia Automotive Group and LG Group, are revising their 2010 sales targets with bigger numbers and are planning bigger budgets to add facilities and invest in new businesses.
Samsung Electronics, the world's biggest consumer electronics maker, recently launched a new business unit devoted to medical equipment and healthcare-related products.
The company is also planning to spend more aggressively on its main business units ― memory chips and flat-screen panels ― with a combined budget of 8.5 trillion won representing a 20 percent increase from this year's 7 trillion won.
Samsung Electronics, the crown jewel of the Samsung empire, is the world's leading provider of memory chips and flat-screen panels, and the company expects bigger earnings from the two markets as the global demand for personal computers, handsets and liquid-crystal display (LCD) televisions looks ready for a turnaround.
LG Electronics, Samsung Electronics' bitter industry rival, set up a specialized unit for smartphones and other advanced mobile devices.
"The corporate giants look to be preparing stronger investment in 2010 compared to this year, as the agenda moves from survival to growth," said a representative from the Federation of Korean Industries (FKI), the country's biggest business lobby, Friday.
Next year will be particularly critical for Samsung, as it looks to strengthen its position in emerging consumer product segments such as light-emitting diode (LED) backlit televisions and smartphones, which support Web browsing and multimedia atop of voice.
The LG Group is also looking to boost its competitiveness in smartphones, rechargeable batteries, LED-related products and next-generation telecommunications technologies such as Long Term Evolution (LTE).
LG Electronics is the world's second-largest LCD maker and No. 3 handset vendor, while LG Display tails only Samsung Electronics in the panel business. LG Chem is also strengthening its position in the battery market.
"It has been decided that the group will be spending more on new business sectors and research and development (R&D)," an LG Group spokesman said.
"The group's top decision makers have reached a broad consensus to invest more in new sectors and research and development (R&D) for next year," the spokesman said, adding "selective but bold investment" will be the top corporate phrase in 2010.
High Hopes for POSCO, Hyundai-Kia
Steel giant POSCO and Hyundai-Kia, now the world's fourth largest automaker, are also counted among the optimists.
POSCO has slated 4.5 trillion won in its budget for next year to expand its steel plants in India and Indonesia.
Hyundai-Kia will begin construction of its new Brazilian plant around April, and plans for a third China plant are also in the pipelines.
The company is expecting to sell 5.5 million cars in 2010, a 15 percent increase from this year's projected 4.7 million.
Hyundai-Kia is also looking to expand its presence in the luxury car segment. Hyundai Motor will debut its luxury sedan lineup, EQUUS, in the United States sometime next summer, and also launch the new version of its mid-sized sedan, Sonata.
SK Group will spend 10 percent more on R&D activities compared to the 1.3 trillion won it will spend this year.
Hynix Semiconductor, the world's second-biggest memory chip maker, currently up for sale, will invest around 1.5 to 2 trillion won to develop technologies for producing thinner chips.
The Doosan Group, which bought the Czech-based turbine maker, Skoda Power, earlier this year, is also looking for new merger and acquisition (M&A) opportunities in Europe, company officials said.