Large Korea companies such as Samsung, SK and LG are moving into auto-related industries, offering products like automobile computer chips, hybrid car batteries, navigation systems and even imported cars. With cars a necessity of everyday life, these firms are betting that efforts to improve the driving experience will pay off.
Samsung Electronics is putting its auto computer chip business into drive this year, supplying products to European carmakers. Samsung bowed out of the auto industry seven years ago when it sold its automobile subsidiary to Renault in 2000. The company now makes a control chip that links electronic components in cars wirelessly, eliminating bulky electric cables. "Global demand for auto semiconductors could hit US$23.5 billion next year," Seo Chong-kuk, a manager with Samsung, said.
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A navigation system developed by Samsung Electronics
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Earlier this month, Samsung introduced a Bluetooth-enabled auto navigation system for less than W700,000(US$1=W935). The device allows drivers to make phone calls through a built-in microphone and speakers without having to use a handset. It also supports text messaging along with MP3 music files and digital multimedia broadcasting.
Meanwhile, LG Chem is developing a high-performance battery that will be used in Hyundai Motor's hybrid cars. "We're working to build a lithium polymer battery that's better than Toyota's nickel-metal hydride battery in terms of power, capacity, weight and size," an LG Chem official said. "With domestic hybrids slated to be churned out from 2009, we expect sales of our battery could reach into the hundreds of billions of won," he added. The company currently supplies components such as bumper and handles to local automakers.
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LG Chemical's batteries for hybrid cars
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Also with Hyundai Motor, LG Telecom has developed an auto telematics service called Mozen. Combining IT technology and telecommunications, telematics offers various services including navigation, emergency response, traffic guides and wireless Internet. Sister company LG Electronics last year released its own DMB-equipped navigation product, recording sales of 10,000 units since October.
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An advertisement for SK Group's Speedmate repair business in China
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SK Group is also involved in the navigation business through an SK Telecom service that offers navigation via mobile phones. Meanwhile, SK Networks is expanding auto imports, dealing with DaimlerChrysler, Volvo, Jaguar, Land Rover, Peugeot and Infiniti. SK has its fingers in other auto-related businesses, too, with SK Encar second-hand auto dealers and the Speedmate repair chain. Speedmate is now working in China as well. "We were looking for businesses related to our core strength, oil refinement, so expanding our auto-related businesses was a natural choice," an executive with SK Group said.
"With the IT and chemical industries fully saturated, these firms are seeking niche markets like the auto-related industries," said Bok Deuk-kyu, a chief researcher in the Technology and Industry Department of the Samsung Economic Research Institute. "Businesses that enhance the convenience of automobiles will make rapid progress around the world," he said.
(englishnews@chosun.com )
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