One Step Forward

In 2002, the year the European Union officially adopted the euro, my first significant move was the merger of Ajin Motors and Sunyang Motors’ research facilities into the HW Automotive Research Center.

I visited early in the morning with Chairman Song Hyun-chang, President Jo Dae-ho, and CEO Oh Se-hyun to see the prototype of the first car that reflected my vision.

The design center head, designers, and researchers awaited us in the showroom, their faces tense with anticipation.

Not only were people waiting, but a small, gleaming car stood there, proudly displaying its shine.

M21-1

The project name, signifying the first mini car of the 21st century, was attached to it.

The moment I laid eyes on the new car, a score of 85 popped into my head.

Perhaps this number showed on my face, as the design center head and the chief researcher quickly began their explanations beside the executives.

“We opted for a rounded design overall. Given it’s a compact car, we wanted to convey stability. However, the silhouette and character lines rise towards the back, giving it an aggressive design. It’s tense and dynamic.”

“By choosing a low position, we aimed to provide the pure joy of driving, as if the car is glued to the road.”

“We expect that the thrill of driving such a small, cute car will be surprisingly enjoyable.”

I half-listened to their explanations as I began inspecting the car.

With a 796cc engine, automatic 4-speed, and a two-seater coupe, the design was meant to be love at first sight—exactly what I had demanded.

While it wasn’t quite love at first sight, it was certainly cute and attractive enough.

After thoroughly checking the interior, the developers finished their explanations, and others began to examine the car.

“Is a convertible version out of the question?”

I quietly asked the chief researcher, who looked troubled.

“To meet European safety standards, we couldn’t avoid the pressure of manufacturing costs. It was excluded at the design stage due to lack of profitability.”

Despite my repeated requests to focus on creating an impressive new car without worrying about profitability, it seemed they couldn’t escape the ingrained pressure for results. I sighed lightly in disappointment.

Once everyone had inspected the car, the developers looked even more tense.

Now it was time for the company executives to give their evaluations. A single negative word from them could turn all the hard work into a nightmare.

The timeline was set for a fall release. If the decision was made to start over today, it would mean a grueling schedule.

All eyes turned to Chairman Song Hyun-chang. After all, he was the living legend who had elevated Ajin Motors to the second-largest in the country.

He was also a pioneer who had poured his heart into developing innovative cars, even launching the country’s first two-seater convertible sports car at great financial risk, though it was merely assembled.

He slowly began to speak.

“Well done. You’ve all worked hard.”

Chairman Song patted the developers on the shoulder, easing their tension and acknowledging their efforts.

“Everyone, take the rest of the day off and spend time with your families. Who knows what challenges await starting tomorrow.”

President Jo Dae-ho withheld his evaluation but also acknowledged their hard work.

“Let’s have a chat over some tea, shall we?”

President Jo led us, including Chairman Song, outside.

In the reception room of the research center, we sat quietly with cups of tea in front of us.

Especially since Chairman Song was silently sipping his tea, President Jo seemed anxious and spoke first.

“Chairman, I’d like to hear your honest opinion…”

“Hmm? I meant what I said earlier.”

He casually tossed out the words, but President Jo still looked skeptical.

“Really?”

“How many compact cars do we have in our country? Isn’t it excellent for what it is?”

“The fact that it’s a two-seater might be a drawback…”

“Is there a car without drawbacks? Besides, families of four tend to avoid compact cars, prioritizing the safety of their children. Compact cars are secondary vehicles, meant for two people anyway.”

Chairman Song seemed genuinely satisfied. Then he surprised us all with an unexpected statement.

“Don’t worry about my opinion anymore. I’m just a setting sun, aren’t I? I should have stepped down long ago.”

“No, that’s not true. You’re still…”

Chairman Song waved off President Jo’s words.

“I’ve stayed on because I can still serve as a figurehead in official business circles. But with Chairman Joo of Daehyun passing away and Chairman Jin of Sunyang stepping back, it’s undeniable that my role has ended.”

Chairman Song suddenly drained his teacup and stood up abruptly.

“Disregard my opinion and focus on your own thoughts. I’ll head up first.”

“Chairman!”

We were all taken aback by Chairman Song’s sudden action.

“It’s fine. Continue your discussion. An elder should know when to step aside to be respected. I want to be respected by you all. Haha.”

Chairman Song walked away without looking back, leaving the research center.

Though surprised by his sudden declaration, we couldn’t just sit idly by. Those who remained had work to do.

“Shall we share our honest opinions now?”

President Jo looked at Oh Se-hyun first. Receiving his gaze, Oh Se-hyun merely shrugged.

“What do I know? I’m just an ordinary middle-aged man who thinks a good car is big, spacious, and can fit a golf bag in the trunk. When it comes to compact cars, President Jo’s expert opinion is what matters most.”

With Oh Se-hyun stepping back, President Jo turned to me for my thoughts.

“Do-jun, what do you think?”

“It’s exactly the car I wanted. While it’s not 100% satisfying, I think it’s more than enough.”

“A well-designed, affordable car with decent safety?”

“Yes. A car that middle-class parents can buy for their graduating college kids. A car that a young professional can maintain on a three-year installment plan. A car that looks stylish without appearing cheap. That’s my thought, and this new car aligns with it to some extent.”

I offered my opinion from the perspective of an average person.

“How many people buy cars based on performance? Horsepower, power, 0-60, balance… Most people are just looking for a car for commuting and weekend outings, aren’t they?”

“That’s true. I don’t disagree with you.”

“But you seem to have something else in mind.”

“Yes. According to information, Daihatsu in Japan is releasing a 600cc compact car. A two-seater convertible.”

The Daihatsu Copen? Is that coming out this year?

“Even if we consider the domestic market, we have to compete with such cars overseas. Unfortunately, our Korean cars are still bought for their affordability. But the new car we just saw lacks price competitiveness. We can’t just think about the domestic compact car market when moving to mass production, can we?”

“What if we set HW Automotive’s overall profit margin to zero? Would it still lack competitiveness?”

“What?”

“M21-1, right? That’s the project name?”

“Yes.”

“So, we can sell the M21-1 at a loss. We make profits from other models. In other words, if we focus solely on increasing production numbers without worrying about making money, would it still lack price competitiveness?”

President Jo paused, contemplating.

“Focusing solely on the benefits of expanding production scale?”

“Yes. Uncle, would you accept that as a major shareholder? Running a company without profit?”

I subtly signaled to Oh Se-hyun, who quickly chimed in.

“I don’t mind. But keep in mind that if there’s no profit, the stock price will continue to fall.”

“It’s a long-term strategy. After all, it’s not our job to maintain the automotive stock price, is it?”

Even though Oh Se-hyun and I agreed, President Jo’s expression remained uneasy.

The stock price is the indicator of corporate management. If it falls, it can’t be considered good management, and the CEO bears the primary responsibility.

Even if the major shareholder says it’s fine, shareholders are quick to change their minds when they see the stock price dropping.

“President Jo.”

“Huh? Yes…”

I needed to convey my goal clearly to him, who was lost in thought. What does it matter if it takes ten or twenty years to build a proper automotive company?

“What’s the gap between us and Daehyun Motors?”

“In terms of production numbers, it’s 65%, but in terms of sales, we’re less than half of Daehyun. 49%…”

This clearly shows the absence of high-margin luxury cars. The right direction would be to focus on luxury mid-sized sedans rather than pretty compact cars.

But as I’ve already confessed, our position in the global market is as a maker of affordable cars. If we aim for mid-sized sedans, it’s uncertain whether we can even compete with Daehyun, let alone globally.

“Even if we forgo profits and focus solely on closing the gap, does the new car still lack price competitiveness?”

“Are you serious?”

“Yes.”

Oh Se-hyun spoke to President Jo, who was once again checking my intentions with an uneasy expression.

“President Jo, let’s give it a try. What does it matter if we don’t make money from cars? This guy will earn money from the Sunyang Financial Group and bring it to us. Let’s aim for a level where we don’t delay employee salaries, invest in research and development, and expand production lines. Then we might even surpass Daehyun.”

As expected, my uncle is quick-witted. Once the goal is set, he doesn’t worry unnecessarily.

The major shareholder declared that the goal is scale rather than profit. No matter how much the stock price falls, as long as we take one step at a time towards the goal, there will be no change in management.

“Even if it doesn’t receive better reviews than the Daihatsu compact car coming out this year, can it at least be considered a viable alternative?”

“No.”

Without a moment’s hesitation, President Jo shook his head.

“The technology gap with Daehyun is still significant. Let alone Japan? It’s impossible. It will probably be the last choice. Sorry, but that’s our position.”

A harsh self-assessment pierced through him, bringing him back to reality.

“So, what about the compact car market in our country?”

“Over 50% market share for compact cars. That’s my goal. Leave it to me. I’ll achieve it by next year. If I can’t do that even by selling at cost, I deserve to be replaced as CEO. I promise you on my position.”

This time, he exuded remarkable confidence. Seeing him like this, he seemed reliable.

“Then let’s aim for a launch in October and a new model announcement in June. Please expedite the process.”

“June? Why June? The Frankfurt Motor Show is in May, and Paris is in October. I was thinking of the Paris show.”

“As you mentioned, isn’t it more important to focus on the domestic market than the global one? The World Cup is in June. It’s a golden opportunity.”

At the mention of the World Cup, both President Cho and Oh Se-hyun frowned.

“Hey! Even if it’s held here, it’s still someone else’s party. We never get past the preliminary rounds, so why the World Cup?”

Oh Se-hyun’s face was scrunched up in displeasure.

“This time might be different, don’t you think? There’s the home ground advantage. If we perform well, it’ll be a festive atmosphere, and riding that wave could be incredibly effective.”

Well, this is…

It’s hard to explain something no one believes.