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.


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