Tuesday, May 28, 2013

LTW - SK-NK Warmth, Betrayed Housewives, & Abe Ire

1. National
1) Signs of warmth in Korean peninsula

It seems South Korean president Park Geun-hye is winning the chicken game against Kim Jong-un. North Korea has invited a South Korean civic group to organize a ceremony marking the 13th anniversary of a landmark inter-Koran declaration signed by Kim Jong-il and Kim Dae-jung on June 15, 2000. Kim Jong-un sent an envoy to China who met with Xi Jinping with a promise to return to six party talks. North Korea TV even featured South Korean flag for 30 minutes in its ping pong match against South Korea held in Paris. This was the first time South Korean flag was shown on North Korean TV, and could not have been possible without the nod from Kim Jong-un.

If the latest crisis in Korean peninsula was a baby pee, the Aug 18 Ax Atrocity in 1976 was a Niagara Falls. Two American soldiers, 1Lt. Barret and Cpt.Bonifas, were axed to death by North Korean guards while cutting a big tree obstructing a view to the North in DMZ. President Park Jung-hee, Park Geun-hye’s father, and Gerald Ford demanded apology from Kim Il-sung, Kim Jong-un’s grandfather, but got only a raised middle finger from Kim Il-sung. Felt insulted, Park and Ford sent a bunch of U.S. and South Korean soldiers into the DMZ on Aug 21 to cut the ‘damn’ tree. There were 20 F-111 fighters , 3 B-52 bombers, and 24 F-4 Phantoms flying over DMZ, and Midway aircraft carrier in the sea, and 12,000 additional forces from Okinawa on the ground while the tree was cutting down. Any slight reaction against the tree cutting from the North would have triggered all those forces jumping into North Korean territory, but chicken Kim Ilsung did nothing, finally expressing his regrets over the killing. Like father, like daughter!

2) Abe and his friend keep pouring out controversial comments
Japanese PM Shinzo Abe and his friend are determined to steal the spot light from Kim Jong-un. Mr. Abe sat in the cockpit of a fighter jet that has the number 731, which evokes notorious Unit 731that performed experiments on live humans in China. Abe also caused controversy by comparing Yasukuni Shrine to Arlington National Cemetery in Washington. Not to be outdone, Osaka Mayor Toru Hashimoto, co-leader of Japan Restoration Party, said that comfort women “were necessary at the time of war” and recommended U.S. Army officials to “take advantage of legal facilities to release sexual energy.” Comments from Abe and Hashimoto are being criticized by former Japanese PM Tomiichi Murayama, who had made a sincere apology to its neighbors in 1995.

Mr.Hashimoto was in Korea in 2010, touring and praising prestigious high schools in Korea like Seoul Science High School and Daewon Foreign Language High School. No one knew at that time Hashimoto might have visited other places in Seoul to ‘take advantage of legal facilities to release his sexual energy.’

2. Economy
1) When do house wives feel betrayed most?

May 21 is celebrated as “Husband and wife’s Day” as 21 can mean “two people met to make one.” A survey by Korea Working Mom Research at the event of May 21 Day showed that Korean wives felt most betrayed when their husbands “took care of others first” with 41%. Forgetting key days like birthday or marriage day came 2nd with 23%, followed by hiding debts (20%) and flirting with other women (12%). The house wives thanked most when their husbands had shown trust in them with 33%, followed by being nice to wife’s own family(27%) and “trying to keep promises with wife”(26%). Lee Soo-yeon, the head of the research center, said that all women, regardless of age, desire to be acknowledged and loved by their husbands.

I think my wife was not surveyed as a gift would be her prime reason for thanking her husband. Whenever I go out with my wife, I hold my wife hands firmly. People call me a romantic. They never know that’s my last attempt to stop her from jumping into a Louis Vuitton store in Gangnam.

2) Wage definition stirs up confusion
The controversy began in Mar 2012 when Supreme Court ruled that regular bonuses should be counted as part of the worker’s ordinary wage, favoring the union of a local bus company. The problem is that the definition of ordinary wage in the ruling was different from that of the Ministry of Employment and Labor. The ministry states that additional allowances that are not related to working hours, such as regular bonuses, are not calculated as part of the ordinary wage. This is important as the ordinary wage is used as a basis to calculate overtime, severance and retirement payments. While the unions in Korea hailed the ruling, the business community is protesting, saying the companies just followed the government definition for the past 30 years, and the ruling will cause additional 38 trillion Korean won impact. The government plans to hold grand conference from June involving the representatives from the union, business, and the government to reach a consensus.
GM CEO Dan Akerson asked President Park to solve this issue fast or no 8 billion dollar investment in GM Korea. Mr. Akerson also said it would relocate the production from GM Korea to somewhere else at the peak of North Korea crisis a month ago. GM Korea employees are praying Korean LPGA golfers no longer make fun of American players, and Inbee Park give up her No.1 status to Stacey Lewis fast.

3. Auto Industry
1) Renault Samsung might get a strike

There has been no strike since Renault Samsung Motors began operation in 1998, but there might be one, though specific dates have not been identified. The union said that 94% of its 2,650 members favored industrial action. The union is angry because the company proposed wage freeze, and forced employees to use their annual leaves during period when the plant was shut down. RSM is insisting that “the company is under difficult times as all employees know well and there should be not strike.” To resolve the differences, the two sides asked for arbitration by the Busan National Labor Relations Commission earlier this year. However, that also failed to resolve the issues.

RSM may learn a lesson from Ssangyong. The two hardcore union leaders in Ssangyong Motors in Pyeongtaek protesting 30m high on an electric structure for 171 days from Nov 20 last year finally came down on May 9 on their own. Ssangyong didn’t do anything with the two union leaders other than encouraging them to protest there 50 more years.

2) Hyundai’s Czech plant marks 1 millionth vehicle
Hyundai’s Nosovice plant in Czech Republic reached the 1 million mark last week, after three years since its SOP in September 2009. Built on 494 acres of land with $1.44 billion investment, the Nosovice plant has an annual capacity of 330K units, rolling out i30 sedans and Tuscon ix SUV. It has been operating on a three shift system since Nov 2011. Hyundai had only 1.8% of market share in Europe in 2008, but it is now enjoying 3.5% at the moment, thanks to production from Nosovice.

The Nosovice plant is being run by Mr.Joon-ha Kim, who had worked in Hyundai’s Bromont plant in Quebec, Turkey plant, Alabama plant before Nosovice. Mr. Kim was a legend in Hyundai Bromont plant in 1988 when he and his two friends consumed 20 bowls of ramen together. Nothing legendary if this ramen consumption did not happen an hour after a full buffet dinner. The first on the left in the first row is the legend.


Tuesday, May 14, 2013

LTW - GropingGate, Choco Unity, & Dairy Bullies

1. National
1) Park meets with Obama in Washington

Korean President Park Geun-hye met with Obama at White House on May 7. They agreed to “work jointly to induce North Korea to make the right choice” and reaffirmed strong economic and military ties. She also gave a speech at the U.S. Congress in her good English, describing the accomplishments of the Korea-U.S. alliance over the past six decades by telling the stories of Col. David Morgan family, whose grandfather and father also served in the U.S. military in Korea.

Mr. ChungRae Chung, a lawmaker from the opposition party, was criticized by the public when he made a sarcastic Twitter comment like “Psy sings Gangnam style in Korean in the U.S. while our president speaks English in the U.S. Congress. Who can we be more proud of?” Well, buy Google stocks right now. More Americans will have to purchase Google Translator software as ‘proud Koreans’ will send e-mails to their American colleagues in Korean only.

2) Park’s spokes man in sex scandal
Park’s success with the U.S. visit was severely marred by sexual harassment scandal over her own spokesman, Mr. ChangJung Yoon. According to the reports, Yoon grabbed the buttocks of a 22 year old Korean American intern who was assigned to guide the spokesman during Park’s visit in the U.S. The intern reported the case to the U.S. police, and Yoon made a hasty run away flight from Washington to Seoul on his own before being sacked by Park one day later. When Park returned to Korea over the weekend, Yoon held a press conference to deny the charges, but it was reported Yoon confessed to the Blue House officials that he did grab the intern’s buttocks, and showed his naked body to the intern at his hotel room in Washington. Over two thirds of news time is spent for Mr. Yoon’s scandal at this time.

Mr.Yoon might be grumbling why he has to be sacked for grabbing a female’s butt protected under cloths while Obama is all O.K even if he firmly grabbed the naked hands of Park Geun-hye. With two hands, to boot, so more heinous crime......

2. Economy
1) Choco Pies popularity in North Korea

The U.K. newspaper Guardian reported that marshmallow-filled Choco Pies from South Korea “have achieved legendary status among North Koreans.” The paper said the small, round sugary snack given as a reward to North Korean workers in Kaesong Industrial Complex will accomplish what world leaders have tried in vain with aid, lectures, sanctions and engagement. The Guardian cited Andrei Lankove, the expert on North Korea, as saying "Choco Pies are an important mind-changing instrument. It has become a symbol of South Korean prosperity -- and North Koreans read it. They are suffering and starving, but thanks to Choco Pies, people don't buy the old story that the South is even poorer." Choco Pies were originally developed by Orion Confectionary in 1974.

Choco Pies are sold at 500won a piece in North Korean black market, while an average worker’s monthly salary is only 5,000 won. With no more Choco Pie supply to North Koreans as Kaesong is now closed, it might be even selling at higher price. Don’t worry about Kaesong as it will re-open soon when Kim Jong-un runs out of Choco Pies.

2) Namyang apologizes for bullying store owners
Namyang, Korea’s largest dairy products maker, got into a trouble when a store owner posted on YouTube an audio file of a conversation between himself and a Namyang sales manager. On the tape, the sales manager pressured the store owner to buy more products, saying “I don’t give a damn about your stupid business and don’t care if you are completely ruined. How dare you disobey my demands? I’m going to kill you if I see you. ” There were a lot more colorful Korean four letter words that I chose not to put here. The stock price and the sales of Namyang took a nosedive after the consumers began boycotting Namyang products. Facing the worst crisis since its foundation in 1964, its management made a public apology and promised to provide 50 billion won to support its store owners.

My wife’s younger brother works at Namyang as a quality manager. I talked to him after my return from Chicago last Friday. He thanked Yoon family. First for me, HyungSik Yoon, for rescuing his sister who had a hard time finding a good husband 24 years ago, and for the other Mr. Yoon whose sexual harassment scandal last week managed to divert the public’s attention from his company.

3. Auto Industry

1) Hyundai to build its 4th plant in China

Faced with ever increasing Chinese market and the untouchable labor union in Korea, a Hyundai vice chairman told reporters that Hyundai is planning to build its 4th plant in the mid-west China The vice chairman said Hyundai is currently in negotiation with the Chinese government and its capacity would be 300K a year. Hyundai has recently added some capacity in its Beijing plant to make 1.05 million units per year, and its sister Kia is pushing to shorten the SOP for its third plant by two months to start in April 2014, to have 740K units in Yancheong. Once Hyundai’s 4th plant is completed in 2015 as the vice chairman envisioned last Friday, Hyundai & Kia will have 2.1 million units a year capacity in China. The combined sale for Hyundai and Kia in China is forecasted to reach 1.5 million vehicles this year.

As of April this year, Hyundai sold 37.4% more and Kia a 24.6% more than the same period last year in China. All this jaw dropping figures thanks to Chinese consumer reaction to recent controversial comments by Japanese PM Shinzo Abe on the Japanese role in Asia during WWII. The sales people in Hyundai America are praying Mr. Abe begin talking about Pearl Harbor.