Kimchi or German Style Roast Pork – German Companies in Korea

South Korea is the EU's fourth-largest non-European trading partner, responsible for some 93 billion dollars worth of trade a year. South Korea produces many high-tech products and increasingly the nation is focusing on green technologies. Some of these will be presented at the Hannover Messe later this month. And, in spite of the difficult economic climate, German companies are increasingly targeting South Korea as an export market. Manuela Kasper-Claridge examines what chance cutting-edge technology from Germany has in South Korea and what why the Korean market poses such a challenge. --------------------------------------------------- The fishmarket in Seoul. Martin Rotermund is out shopping for the evening meal. Haggling is a way of life in South Korea. Rotermund, from Germany, speaks Korean well. This plaice is too large and too expensive for the meal with his wife and daughter. But 10 minutes later, they reach a deal. Rotermund, CEO of Rittal Korea, has lived in Seoul for 7 years and knows that Koreans enjoy striking a hard bargain: "Of course he asks a higher price to begin with, and I give him a lower price and tell him that he has to agree to this price, then he adds his service and another small fish and then we meet in the middle." Rotermund has set up a production company for Rittal just outside Seoul. Now 50 Koreans work for the medium-sized business and make ultra-modern control cabinets for factories. German technology at cheap Korean prices is the manager's aim. So production began here in South Korea at the end of last year. Turnover is currently about 16 million euros a year. Martin Rotermund: "Local production has allowed us to be extremely competitive, and we are now able to offer at local market price levels and I'm sure that we will be able to achieve very strong growth rates." But in order to be successful, they have to come up with ideas... For instance, Rotermund had a truck converted into a mobile exhibition vehicle. If Korean customers are short of time, the products come to them. And this service pays dividends. Potential purchasers in nearby office buildings are keen to put the switchgear cabinets to the test. Rotermund is there to answer any questions. He's keen to spread the message about the company's products: "If you can be successful here, you can be successful worldwide. In Korea, customer standards, their requirements are extremely tough. But as you've seen, the interest is there. So I'm happy today." German companies have created more than 100,000 jobs in Korea, as in Jeollabuk province, three hours by car from Seoul. One of Korea's sunniest regions, the Solarworld company is building a solar power station here for a Korean energy supplier. Although South Korea's renewable energy business is in its infancy, the potential for development is huge. The country wants to change direction and reduce its dependency on imported energy, and German firms are leading the way. Byong-Seon Jang, Solarworld Korea, explains what makes Korea so special: "We're building several solar plants now. Korea already has 300 megawatt solar power stations. In this area, sunshine produces about 1500 kilowatts an hour per square meter. This is considerably more than in northern regions in Europe." Solarworld has set up a joint venture with a Korean partner and began manufacturing solar modules locally several months ago. Jörg Walberer is in charge of production and workflow is constantly being improved. More than 60 million dollars have been invested here, but there are still snags. Sometimes this is due to a difference in attitude. In team meetings with the Korean management at Solarworld, the German manager says openly what displeases him. The Koreans prefer a more indirect route. Jörg Walberer, CEO of Solarworld Korea: "Something goes wrong every day. And the employees are learning on the job. But I think that this is a completely normal process compared with other production sites. We have to find a way of getting along, as in any relationship." But there are many similarities between the two countries. Football is the national game and the Korean partners have had a German country house built on the industrial estate... in an expression of fellowship. Jörg Walberer: "You just have to look at the space here. There's still about ten times as much as we've already built on, and so it's easy to work out that we could still install ten times as much capacity here." The Solarworld managers spend many evenings with their business colleagues and customers. Usually over a good meal, as is the custom in Korea. Koreans consider that the company is almost as important as their own family, and their German partners are part of this now.

DW-World | April 21, 2009

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