Elon Musk stunned South Korea and Tesla watchers alike when he popped up final week on a video name with President Yoon Suk Yeol.
Yoon’s workplace launched particulars of the chat, revealing Musk had mentioned he thought-about the nation a best choice for funding.
Shares of battery-related corporations like Samsung SDI and Posco jumped, regardless that Musk didn’t clearly say he truly needs to construct a manufacturing unit within the nation.
Yoon, battling poor public opinion polls, was eager to make the pitch for why the Tesla CEO may need to take into account South Korea, citing the nation’s high-quality engineers and auto elements makers, and steady provide of electrical energy. Analysts additionally had been upbeat.
“It’s attainable, as a result of Tesla is already utilizing quite a lot of elements made by Korean corporations,” Koh Tae-bong, a Seoul-based analyst at HI Funding & Securities, mentioned.
“There isn’t any nation like South Korea that has an virtually full provide chain for EVs. Now we have a big chipmaker in Samsung Electronics, three battery-cell makers, cathode and anode supplies makers, digicam module makers and different smaller key part makers.”
Koh isn’t fallacious. Basic Motors has its largest technical heart exterior the U.S. in South Korea and speaks extremely of its engineers there.
The nation has confirmed resilient all through COVID, skirting large-scale lockdowns which have been widespread in China.
Musk most likely would additionally like South Korea’s International Funding Promotion Act, which gives money incentives and tax advantages.
The South Korean public loves Tesla, too, as I witnessed throughout a visit to Jeju island in Could to attend the Worldwide Electrical Automobile Expo.
Retail traders have purchased into Tesla inventory in a giant method, with people in South Korea holding round $9 billion of shares, in keeping with information from the Korea Securities Depository.
South Korea additionally matches proper into Musk’s “ hardcore” working tradition. It’s one of many hardest-working nations, logging extra hours than the U.S. and another Asian nation within the OECD.
Simply 4.4 % of some 21 million folks within the nation are working from house, up from solely 2 % in 2020, the primary yr of the pandemic.
On the flipside, there are causes Musk may battle in South Korea. There may be the apparent geopolitical danger stemming from North Korea’s nuclear actions.
Sturdy labor legal guidelines can also manifest in frequent strikes by extremely unionized workforces. There may be one happening now, because it occurs, by the truckers union that has clogged up ports and industrial complexes and hampered provide of key exports.
Musk’s opposition to unions is well-documented. He’s a vocal critic of the United Auto Staff, and the Nationwide Relations Labor Board dominated final yr that Tesla had repeatedly violated U.S. labor regulation.
“South Korea is called having a few of the strongest labor unions on this planet,” mentioned Choi Woongchul, a professor at Kookmin College in Seoul. “I might put the prospect of a brand new Tesla gigafactory in Korea at zero.”
Musk may need to learn up on Kaher Kazem, the previous head of GM in South Korea, who now faces a possible jail time period on prices of illegally hiring contract employees. Prosecutors are in search of a 1.5-year jail sentence for Kazem, who at one stage was banned from leaving the nation.
HI Funding’s Koh had a considered how a Tesla plant in South Korea may work: “Make it one hundred pc automated.” Musk had higher get busy on his humanoid robots.