Samsung, Hyundai Motor to make early payments to suppliers ahead of Chuseok holiday

Samsung employees look at a monitor to purchase products sold at the conglomerate's online marketplace ahead of the Chuseok holiday, in this undated file photo released, Sunday. Courtesy of Samsung Group

Samsung Group and Hyundai Motor Group are set to make early payments to suppliers before the upcoming Chuseok holiday to help boost sluggish domestic consumption, the two conglomerates said, Sunday.

Samsung’s 12 affiliates, including Samsung Electronics, Samsung Display, Samsung SDI, and Samsung SDS, will spend approximately 870 billion won ($649.7 million) to pay for their purchases from subcontractors. These payments will be made up to 15 days earlier than usual.

The move is aimed at helping their partners manage their funds more efficiently before the holiday season. Additionally, Samsung launched an online marketplace to sell regional products from small- and medium-sized enterprises (SMEs).

Samsung’s employees and executives can purchase groceries and various products through the online sales channel. This initiative is part of the group’s efforts to stimulate local businesses ahead of the five-day Chuseok holiday, which begins on Sept. 14.

Samsung Group is also managing a fund for co-prosperity with its partners. Established in 2010, the fund is valued at 3.4 trillion won. Samsung’s partner firms can use it to support their equipment expansion and research activities.

The company has also been supporting small firms improve their manufacturing capabilities since 2015. To date, a total of 3,274 smart factories operated by SMEs have benefited from the Samsung-driven project.

Hyundai Motor Group has also joined the effort, announcing plans to make early payments totaling 2.38 trillion won to its subcontractors before the upcoming holiday.

Key affiliates of the group, including Hyundai Motor, Kia, and Hyundai Mobis, will make these payments to a group of 6,000 partner companies. The plan aims to stabilize the cash flow of these partners, the carmaker said.

Hyundai Motor Group has also purchased vouchers worth 25 billion won that can be used at traditional markets nationwide. The firm's employees and executives will receive these vouchers, which the company hopes will boost domestic consumption and support local communities during the Chuseok holiday.

The company also plans to make additional donations to social welfare centers and elderly care facilities.