Category: Korea-Business

The 52 hour work week is really just 40 hours like in the U.S. but has an additional 12 hours of overtime. I can understand how limiting workers to only 12 hours of overtime can constrain employers and workers in some industries:

The country currently adopts a 52-hour work week — 40 regular hours with 12 hours of possible overtime. It was introduced in 2018 by the liberal Moon Jae-in government to reduce the maximum week from 68 hours at the time to 52. 

Citing its latest survey, the ministry said the 52-hour workweek has substantially taken root, but some industries have still experienced management problems due to a lack of flexibility in working hours and difficulties meeting deadlines.

In the survey, 48.2 percent of the respondents said the 52-hour workweek has helped relieve matters stemming from work overload, but 54.9 percent said the existing system has failed to reflect the characteristics of some industries. 

In particular, both workers and employers in the manufacturing and construction industries as well as the medical, research and engineering sectors said overtime management of the current workweek needs to undergo changes.

Accepting these survey results, the ministry will maintain the 52-hour workweek, while at the same time beginning discussions with industries that have experienced difficulties abiding by the current rule, seeking to come up with complementary measures that could improve flexibility.

The ministry will also prepare measures aimed at resolving workers’ health concerns that could be affected by the long work hours at those industries.

Korea Times

You can read more at the link.

It looks like South Korea has found another customer for their ever growing defense industry exports:

South Korea and Saudi Arabia are in the final stage of talks over large-scale defense industry cooperation in areas including antiaircraft defense systems and firearms, a South Korean presidential official said Sunday.

Principal Deputy National Security Adviser Kim Tae-hyo made the revelation to reporters while accompanying South Korean President Yoon Suk Yeol on a four-day state visit to Saudi Arabia.

Yonhap

You can read more at the link.

It makes me wonder if any Chinese intelligence operatives were involved in influencing this former Samsung executive to leak this sensitive chipmaking technology to China:

A file photo of the Suwon District Prosecutors Office (Yonhap)

A former senior executive of Samsung Electronics Co. has been arrested and indicted for stealing the chip giant’s trade secrets to build a copycat chip plant in China, prosecutors said Monday.

The 65-year-old former executive, whose name is withheld, was charged with violating the industrial technology protection and unfair competition prevention laws, according to the Suwon District Prosecutors Office.

He is accused of attempting to build a complete copy of Samsung’s semiconductor factory in China after illegally acquiring the company’s confidential data, including chip plant basic engineering data (BED) and process layout and design drawings, from August 2018 to 2019.

The prosecution also indicted six other people — one employee of a Samsung Electronics subcontractor and five employees of a Chinese chipmaker established by the former executive — without detention on charges of colluding in the alleged technology leak.

BED is a technology needed to ensure impurities do not exist in semiconductor manufacturing facilities. Process layout contains information on the floor plan and dimension of a chip plant’s eight core processes for semiconductor production. Such trade secrets essential for the manufacturing of sub-30-nano DRAM and NAND flash chips are considered national core technologies.

Yonhap

You can read more at the link.

Now in addition to using personal email, Chat GPT is now the latest threat companies have to be aware of where their corporate secrets could be inadvertently leaked by employees:

Samsung Electronics has experienced continued data leaks, amid the intensifying global competition for supremacy in the semiconductor sector, according to industry officials, Wednesday.

Samsung Electronics said its Device Solutions (DS) division in charge of chip production dismissed an engineer recently who was found last month to have sent dozens of emails containing proprietary data to private email accounts.

The company also asked for police to investigate the case.

“Through disciplinary measures and legal actions, we will be tough on coping with this issue,” a Samsung Electronics spokesman said.

In March, another Samsung Electronics engineer mishandled confidential company data by uploading source code to ChatGPT. This case led the company to restrict its employees from using the artificial intelligence-based chatbot during work.

Korea Times

You can read more at the link.

South Korea is a much better location than China to be building a Gigafactory. The Chinese government is already meddling in Tesla operations in Shanghai. Tesla would likely be free of such meddling with a South Korea based plant:

President Yoon Suk Yeol met with Tesla CEO Elon Musk on Wednesday and asked for his investment in a gigafactory in South Korea, a presidential official said.

The meeting took place at Musk’s request during Yoon’s state visit to the United States, according to senior presidential secretary for economic affairs Choi Sang-mok.

Yoon said South Korea boasts world-class manufactured robots and an advanced labor force, making it an ideal location to run a gigafactory.

“Should Tesla decide to invest, we will provide active support in terms of location, workforce and taxes,” he was quoted as saying.

Musk responded that he expects to pay a visit to South Korea, saying the country remains an interesting and leading candidate to host a gigafactory, according to Choi.

Yoon also voiced hope for greater cooperation between South Korean businesses and SpaceX, a U.S. spacecraft company headed by Musk, to help foster South Korea’s space industry.

Yonhap

You can read more at the link.

It will be interesting to see how the South Korean government and Samsung react to this request:

Samsung Electronics’ chip plant in Xi’an, China [SAMSUNG ELECTRONICS]

Samsung Electronics and SK hynix should not sell chips to China to make up for the shortfall in supply following China’s sanctioning of Micron, the White House has told the Korean government.    
   
The Financial Times reported Sunday that the Joe Biden administration reached out to Seoul to ask for a cap on the chip sales, although neither government confirmed.  
   
If the Yoon Suk Yeol government acts on the request, the push could exacerbate weaknesses at Samsung Electronics and SK hynix, which have been hit hard as a result of oversupply. 

Joong Ang Ilbo

You can read more at the link.

The IRA may have the intended effect of forcing foreign manufacturers such as Hyundai to increase U.S. based manufacturing and getting rid of their Chinese batteries:

Hyundai Motor Group is facing an uphill battle in the U.S. market for electric vehicles (EV), because its car brands ― Hyundai Motor, Kia and Genesis ― were not included on a list of EVs eligible for up to $7,500 in subsidies granted by the U.S. Inflation Reduction Act (IRA), according to industry officials, Tuesday.

Previously, EVs could qualify for the tax credit as long as they were assembled in North America, but they had to meet stricter battery requirements.

However, detailed guidance measures released last month guarantee only a $3,750 subsidy for EVs that use at least 50 percent of battery components manufactured and assembled in North America, even if the vehicles were assembled in the region. Another $3,750 is available when at least 40 percent of key minerals used in the batteries are mined and processed in the U.S. or its free trade agreement partners.

Under the detailed guidelines of the IRA, EVs manufactured by Hyundai did not make the list. The Electrified GV70, an SUV model of the group’s luxury brand Genesis, was also excluded as it is equipped with Chinese batteries.

In addition to Hyundai Motor Group’s EVs, other brands such as Nissan, which was eligible for the subsidy because it has factories in North America, were also dropped from the list. The eligible cars are made by American brands such as Tesla, Ford, GM and Stellantis.

In response, Hyundai Motor Group said it plans to increase EV production in the U.S. over the long term, aiming to become a leader in the market for such vehicles. The group added it will actively utilize lease sales that qualify for tax credits.

Korea Times

You can read more at the link.

It looks like these Korean corporations will need to determine if having restrictions in the U.S. market is worth partnering with these Chinese firms:

Legal experts in Korea have begun to sound the alarm regarding LG Chem, SK on and POSCO Group, warning them that their joint ventures, established here in Korea with Chinese firms, could be designated as foreign entities of concern under the U.S. Inflation Reduction Act (IRA).

If their warnings turn out to be true, the products of their joint ventures may lose ground in the U.S. market, as they will not be able to enjoy benefits from the country’s subsidy rules.

Last Friday, law firm Kim & Chang said that joint ventures with Chinese companies are likely to be regarded as foreign entities of concern, as the U.S. Infrastructure Investment and Jobs Act defined the term as any foreign entities owned by, controlled by, or subject to the jurisdiction of North Korea, China, Russia and Iran.

“The U.S. will not allow its taxpayers’ money to flow into China,” lawyer Shin Jung-hoon of the nation’s largest law firm said during a conference on countermeasures against the IRA.

Korea Times

You can read more at the link.

I agree with South Korea’s move to increase chip production, but putting these plants within North Korean artillery range around Seoul is not a good idea. These plants are so important they should be built further south out of artillery range:

South Korea will create the world’s largest semiconductor cluster in the Seoul metropolitan area by attracting 300 trillion won (US$229.81 billion) in investments as part of efforts to secure a competitive edge in the sector, the industry ministry said Wednesday.

It is part of the government’s comprehensive plan to promote six key industries — chips, displays, secondary batteries, bio, future vehicles and robots — which also called for the corporate investment of 550 trillion won by 2026, according to the Ministry of Trade, Industry and Energy.

Yonhap

You can read more at the link.