Samsung Electronics announced that it will move all of its home appliance factories to Kwangju, South Korea during the latter part of 2004.
The company said it had already transferred one of its washer production lines to the city this month with further movement slated soon. "We plan to relocate all our production lines of washers and air-conditioners from Suwon to Kwangju this year," a Samsung Electronics spokesman said.
The relocation represents Samsung's full-fledged implementation of its local plants rearrangement plan by region. Under the plan announced last year, Samsung seeks to foster its Kumi plants in North Kyongsang Province as a cell phone hot bed while Tangjong-Asan in South Chungchong Province and Hwasong in Kyonggi Province will focus on flat-panel displays and semiconductors, respectively.
The Kwangju plants will accommodate various electric merchandises and Suwon will play the role of the corporate research and development center.
Market observers point out Samsung's reposition was designed to compete with emerging Chinese electric manufacturers, which pose a threat to Samsung on the back of low-price products. "An urgent sense of crisis triggered by Chinese electric makers prompts Samsung to take a measure to cut costs. Samsung's relocation can be understood in this context," a Seoul analyst said.
He expected the relocation to Kwangju would help Samsung cut corners in the appliance sector by integrating the components procurement process and slashing logistic costs.
This is Samsung's second electric exodus to Kwangju. In 1999, the firm transferred its production facilities for refrigerators, compressors, and motors to Kwangju. (Korea Times)
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