Securing a Foothold 2
“It’s more about investing with the aim of acquiring technology rather than outright buying. If acquisition is possible, we’ll evaluate its business potential before making a decision.”
“Acquiring a company just to siphon off its technology… It’s not unheard of, but still, that’s quite a bold move.”
In 1994, the German BMW Group acquired the Mini, Rover, and Land Rover brands from the British Rover Group, and in 1998, they took over the luxury brand Rolls-Royce. However, by 2000, they had sold Rover and Land Rover to the American company Ford, retaining only BMW, Mini, and Rolls-Royce.
BMW held onto the Land Rover brand for just six years.
In the UK, the home of the Rover Group, there were daily protests against the acquisition. BMW had used Land Rover’s SUV technology to develop the BMW X5, and once its utility waned, they sold it off.
Of course, Ford’s reasons for acquisition were similar. Once they’ve extracted all the technology, they’ll likely sell it off somewhere else.
“It’s a shortcut, isn’t it? Chairman Song Hyun-chang thought the same way. There’s not much difference.”
“If there’s no significant difference, you shouldn’t even start. All of Chairman Song’s bold investments ended in failure.”
“There is a difference. Even if the thought process is the same, the people are different.”
“Because it’s you? The investment genius?”
I shook my head. This isn’t about investment; it’s about management.
“No. The mainstream is different, isn’t it? It’s not the Ajin people but the Sunyang people who are at the core.”
“Is that so?”
He seemed pleased. No one, young or old, dislikes a compliment.
“Even if Sunyang Motors ranks third or fourth, their performance has been good. They were the latest entrant among car companies, yet they achieved those results while enduring pressure from the likes of Daehyun. The people are different.”
“You’re putting a lot of pressure on me. Haha.”
President Cho Dae-ho, who had been chuckling, turned serious again.
“Whether it’s investment or acquisition… do you have the money?”
“I’m not just saying this for the sake of it. I’ve been keeping it in mind. To take it to the next level, we need a significant stimulus. That stimulus would be collaboration with a foreign car company with outstanding technology. Find a suitable company. Don’t worry about the money. I’ll find a way to secure it.”
I replied earnestly.
“Please, don’t misunderstand. I’m not doing this because I’m a car enthusiast looking to waste money. You know, right? I have a driver’s license but never drive. I even have a chauffeur.”
“I know it’s not just a hobby for a third-generation chaebol. Alright, I’ll start looking into it. I don’t think it’s a supercar manufacturer. We’re not producing high-performance full-power cars. I’ll investigate companies with the technology we need.”
“Yes. I’ll leave that entirely to you, President.”
There’s no need to meddle in the expert’s domain. He’s spent considerable time with my grandfather.
He must have learned well how to spend money efficiently.
Daehyun Motors beat us by exactly three days.
They plastered every possible advertising medium—newspapers, TV, magazines, the internet—with their compact car, the
Even bus ads, which might be a first for them.
“Looks like they’re taking a big hit.”
CEO Oh Se-hyun chuckled as he watched the TV commercial.
“They’re trying to crush the sprout. They’re attempting to block the craze for our
“They’re emphasizing the price and the fact that it’s a four-seater too much.”
“They’re following the textbook. Precise targeting.”
“What do you think? Is it doable?”
“It’s concerning, but our positioning was different from the start. Our goal is to create a new market.”
Oh Se-hyun burst into laughter.
“Haha, I’ve heard that somewhere before. Oh, right. It’s what those venture guys say when they’re desperate for investment. Positioning, targeting, new market creation. But you know, right?”
“They were all impractical. But I’m not a venture CEO desperate for investment. So I don’t need to sugarcoat my words.”
“Really? Let’s see. Haha.”
“Hey, uncle. I mean, the representative of HW Motors’ largest shareholder. Are you just going to watch like it’s a firework show?”
“Listen, real shareholder. I’m just your faithful proxy.”
After exchanging light-hearted jokes, we turned our attention back to the TV.
“Let’s see how our first commercial turns out.”
“It’s the news. We spent quite a bit, but haha.”
The first segment of the 9 o’clock main news covered an unusual event.
“Today, HW Motors recreated the cheers of the Red Devils with Guus Hiddink, the hero of the World Cup semi-final miracle, and player Park Ji-sung.”
Following the anchor’s opening, aerial footage of the massive factory yard appeared on the TV screen.
A thousand red
“All the supporters who won during the World Cup stood in front of their cars. Notably, HW Motors prepaid the entire 22% tax that winners usually bear and completed the registration process. The winners can simply take the car keys and drive away, just like in a movie.”
The camera panned over the long line of people, including Coach Hiddink and player Park Ji-sung.
“Oh, it looks like they’re starting. The Red Devils from all over the country—Seoul, Busan, Daegu, Incheon, Daejeon—are driving out of the factory in their red
Oh Se-hyun laughed heartily at the anchor’s commentary.
“Wow, how much did you pay them to get coverage better than an ad? They’re really giving us a boost.”
“It’s marketing expenses. We generously allocated TV ad slots and spread envelopes around the newsroom. They’re doing it because it’s worth it. Do you think Daehyun didn’t spread envelopes in the newsroom? They just don’t have a story to make the news.”
“They gave us a one-minute ad on a program with a 25% viewership. Worth the money.”
“What do you think of the car?”
“It’s pretty. That’s all the praise I can give. It’s not my taste.”
We also checked if it could appeal to those whose tastes didn’t align.
“Post a notice tomorrow.”
“A notice?”
“Yes. If a Miracle employee buys an
“That should sell a few. We have quite a few support staff here who don’t earn high salaries.”
“So those who earn high salaries won’t even look at it?”
“Hey! The people here won’t buy it unless a golf bag fits in the trunk.”
“Even if they can stand it in the passenger seat? Won’t they buy it as a second car?”
“They buy German cars as second cars. Don’t expect too much.”
I didn’t dream of a massive hit, but it would be a lie to say I had no expectations. However, reality was harsh.
“The frontline salespeople are going crazy. There’s a flood of inquiries, but not many are actually coming to sign contracts. We might not meet the 7,000-unit target.”
President Cho Dae-ho didn’t look pleased.
“Close to ten million won isn’t a small amount. It might end up being a toy for those with some money.”
Oh Se-hyun tossed a sheet of paper with a list printed on it.
“My prediction was wrong. The response from Miracle employees is explosive. To them, it’s a ‘car that costs less than ten million won.’”
A list of nearly a hundred names.
“Our company offers high salaries. All the single employees, especially, have applied. Many managers have applied too. They’re selling their domestic 2,000cc sedans that their wives drive and buying this. For executives, it’s a gift for their kids.”
“In the end, it’s a matter of wanting it but finding the cost burdensome. Should we have offered 48-month installments?”
President Cho quickly shook his head.
“No. 36 months is the limit. Have you considered the financing costs?”
It felt like a spark could change everything, and suddenly, I realized what that spark was.
“So it’s just a bit of money that’s the issue. It’s a very fine line where buying our car is burdensome, right?”
“Exactly.”
President Cho looked at me intently, as if seeking a promise.
“We can’t lower the price any further. We’re selling with no profit. We can’t take a loss.”
I misread the situation. I wasn’t suggesting selling it cheaper.
“What about credit card installments?”
“What?”
“What? Credit cards?”
Both of them exclaimed simultaneously.
“Sunyang, Daehyun. These card companies are very aggressive right now, aren’t they? Both have recently changed owners. Instead of swiping a few hundred thousand won, it’s a million won in one go. Wouldn’t they be tempted?”
This time, neither of them responded.
I anticipated that if we could negotiate with the card companies, it would open the floodgates. From the card companies’ perspective, the risk is significant. But isn’t this the moment of fierce competition? When competition heats up, there’s no better opportunity. It’s a chance to secure customers quickly.
Buying a car with a credit card will become common later, but not yet. Currently, it’s only possible through car companies and capital companies’ installment programs.
Sneaking in a composite card financing option wouldn’t be a bad idea.
“Shall we give it a try?”
President Cho was the first to speak. His positive outlook meant Oh Se-hyun would likely agree too.
Oh Se-hyun didn’t speak first because the responsibility for management lies with President Cho Dae-ho.
“Then, please create a financial program that they would find acceptable. I’ll start with preliminary meetings with the card company owners.”
Fortunately, I know both of them.
One is my uncle, and the other is someone I call uncle.
The amusing part is that the card companies are set to crash next year.
I’m about to add a few more bombs to their load, making it even harder for them to recover.
“Buying a car with a credit card?”
“Yes. It’s not really anything special. Isn’t it just like buying goods on installment? The only difference is the amount… but setting that limit is up to the card company. How is it different from buying a 3 million won luxury bag?”
Chairman Joo Kwang-sik of Daehyun Finance listened to me with interest.
“Our company’s installment plan only goes up to 36 months. But with a credit card, you can stretch it to 48 or even 60 months without any issues, right?”
“Hmm… sounds promising.”
“Why not create a product by carefully analyzing the interest rates? You could start by testing it with our
“You must have some deep ties with Sunyang Motors, coming here to pitch like this.”
His sharp gaze pierced through me.
“I’m somewhat involved with Miracle, and isn’t Sunyang my grandfather’s company? I can’t just ignore it.”
“Is that all there is to it?”
“Let’s save the backstory for later and focus on the business at hand.”
“Watching you all worked up is quite entertaining. I’ve heard the stories—you’re having a tough time, aren’t you?”
“That’s all thanks to your brother, the chairman of the car company. This is dumping at its finest. The more we sell, the more we lose.”
“Any losses from selling compact cars can be offset by selling a few flagship models. Daehyun Motors has a wide range. Haha.”
“So wouldn’t it be fun to just keep losing and ruin the image?”
Chairman Joo Kwang-sik paused for a moment before bursting into laughter.
“Haha, I’d love to see my brother’s face all twisted up.”
“Once the credit card installment product is out, we’ll turn the tables. That’s what our analysis says.”
As his laughter subsided, Joo Kwang-sik proposed a new condition.
“How about Sunyang Capital takes the prime 36-month plans, and I handle the extended 48-month ones? No, that won’t do… I’ll consider it if you stop the Sunyang Capital program.”
“Deal.”
His eyes widened as I answered without a second’s hesitation.