“Isn’t this less a bargain sale and more a closing-down sale? No matter whose analysis I look at, the electric vehicle market seems hopeless.”
Manager Oh spoke bluntly.
“Yesterday, I heard Donald said at the UN General Assembly that climate change is a hoax. Judging by the way things are going, carbon reduction is dead in the water. The EV market’s going to be in the dark ages for at least four years.”
“No matter how stubborn that man is, he can’t beat the stubbornness of physicists.”
“What?”
“Whether it takes four years or forty, the global community will ultimately reorganize industry in the direction of reducing carbon emissions. If we waver during the transition period, we’ll lose a great deal of money.”
As the world had feared, Europe’s plan to phase out internal combustion vehicles by 2035 ended in failure. But if my memory was correct, that was when penalties against internal combustion vehicles began.
By the time that new era arrived, the automobile market as we knew it had been completely reshaped. Just as countless companies had gone bankrupt after the advent of smartphones, the coming EV era would also face brutal restructuring.
“...”
In truth, Asan Motors doesn’t exist in my memory.
America with technology, China with unit costs...
Crushed beneath the brutal G2 automakers, it had ended up being acquired, with cars that were neither competitive in price nor in technology.
In truth, the widening gap in technology and costs had more to do with national competitiveness than corporate competitiveness. The G2, fortified by all sorts of subsidies and robust domestic markets, nurtured their own automobile industries until their competitors withered and died.
Donald’s outrageous tariffs are the opening shot.
America’s protectionist stance will not be easily reversed, and we have to endure this long winter.
Can I really change the future I know?
“This is the cheapest it will ever be. We need to invest more. Asan Motors will survive in the EV market.”
When I spoke in a tone filled with conviction, Manager Oh faltered.
Thank goodness I’d managed my reputation well so far. Manager Oh looked unconvinced, but he couldn’t easily refute me.
“...Maybe it really is time for me to retire. No matter how many times I hear it, what you’re saying makes no sense.”
“Manager.”
“...Fine. Fine. Let’s increase our investment in Asan Motors. And put thirty percent of the venture investment fund into autonomous driving.”
He answered with the expression of a man forced to swallow bitter medicine.
In truth, his prediction was more accurate this time. How could Asan Motors’ sales improve when tariffs that hadn’t existed before had suddenly appeared? Still, thanks to the reputation I’d built up until now, my insistence worked this time.
“Good. That’s enough talk about cars. Then what do you think will happen to other industries?”
Once the automobile discussion ended, an even more terrifying topic was waiting for me.
“What’s scarier than blanket tariffs are item-specific tariffs. Those are at least fifty percent. It looks like all our intermediate goods, including steel, are going to get hit by tariffs. Do you think those will be fine too if we just hold out a little?”
This time, even my expression hardened at once.
What the current negotiating team was trying to reduce was only the blanket tariffs. Our intermediate goods, including steel and aluminum, were helplessly taking the full fifty percent hit. As a result, our steel exports, which had been worth around 300 million dollars, or 400 billion won, had fallen twenty-five percent year-on-year.
“To be honest, this looks like it has no answer. Chinese dumping on one side, American tariffs on the other.”
“...”
“All steel stocks, including PASCO, have already plunged by at least forty percent. The risk team is already saying we should liquidate. You agree on this one too, don’t you?”
“...We need to buy.”
“What?”
“For Korea, steel isn’t an intermediate good. It’s a raw material. In effect, we build ships and make cars with products processed here. If this primary market collapses, do you think the secondary market will be safe?”
“Hey, are you the president or something?!”
Manager Oh shouted.
“Now that I hear you, you’ve been sounding strange for a while now. Whatever the circumstances are, that’s not something we should be getting involved in. We should only be talking about stock risk.”
“...”
“The risk team has even said there’s no outlook for steel for at least four years. But in my view, it’s at least ten. Even if the American tariffs end, Chinese dumping will be waiting. Is there any hope in steel? We can’t do anything about the stakes the government forces us to hold, but we should sell the portions we can. I’m speaking purely in terms of profit.”
“...I’m also speaking purely in terms of profit.”
“What?”
“The steel market is an extremely important market for us. I believe the government will soon establish countermeasures against dumping.”
Manager Oh let out a hollow laugh, as if dumbfounded.
“How do you know that?”
“Well, that’s...”
“Your intuition again?”
“...It has never been wrong.”
“You little—seriously, today!”
“If they don’t respond, I’ll make them respond.”
“W-what?”
I spoke urgently.
“Manager, please give me just a little more time. I’ll earnestly request that the government respond to dumping.”
“Haa...”
“There will definitely be comprehensive measures. Perhaps they’re already working on them. Honestly, even if steel stocks fall, it does us no good, does it? We can’t sell beyond a certain stake anyway.”
When I pointed out the practical issue, his expression turned cold again.
“What if you can’t? What if the government isn’t preparing any response at all?”
“Then... we’ll have to sell. But that won’t happen. The fact that they didn’t easily hand over the 350 billion dollars in investment to the United States means they’re definitely preparing for something.”
“Haa...”
“Please trust me. The current government endured backlash from its core support base and brought out the card of opening up agricultural markets. They must also be preparing for our item-specific tariffs.”
Manager Oh fell into thought for a long while before finally opening his mouth with difficulty.
“What are you going to do?”
*
Off the coast of Pohang on the eastern shore of Gyeongbuk.
Chairman Park Gyeongcheol, having gathered the executives, sighed as he looked toward the horizon.
As of today, it had already been sixty days. Two months had already passed since the U.S. tariffs began.
PASCO’s exports to the United States themselves accounted for only around three percent, not a very large share, but just as a single grain of rice was precious in a famine, those tariffs were also quite fatal to PASCO.
In truth, what hurt more than the U.S. tariffs was that Asan Motors’ factories kept moving to America. Changing the production site meant they would also use American-made intermediate goods. From PASCO’s perspective, it felt like having a dependable iron rice bowl snatched away.
As he was lost in long contemplation, Executive Director Choi, who handled government affairs, hurriedly opened the door.
“What happened?”
At Chairman Park’s question, Executive Director Choi lowered his head deeply.
“I’m sorry... They say not a single drop was found.”
“What? Not a single drop?”
“Yes...”
“No, does that make any sense? The president made such a huge fuss about it.”
Chairman Park felt as though the sky had turned yellow.
Exactly one year ago, the former president had issued a statement announcing that an enormous amount of oil was buried off the coast of Yeongil Bay. Since it was unusual for the Blue House to step forward directly on such a matter, the announcement seemed to have considerable basis.
Accordingly, PASCO, which was located closest to the area, had made the Yeongil Bay oil drilling project its next-generation growth engine, supporting the investment funds more eagerly than anyone and splitting through bedrock.
But there was nothing.
Not even a single drop of oil came out.
Even so, since the Blue House had announced it directly, they had thought shale gas might at least come out. But forget shale—there wasn’t even a drop of sesame oil.
The East Sea was a very clean sea indeed.
“What about... what happened with that matter?”
A second piece of bad news flew in to Chairman Park, who had slumped into his seat.
“...It seems the government has no plan at all.”
“What?”
“The current negotiating team with the United States is negotiating on blanket tariffs for automobiles and the like, but they say they can’t mention item-specific tariffs at all...”
“Does that make any sense? We’re at fifty percent, fifty! If they can’t cut these tariffs, then shouldn’t they at least be making them build factories in Korea?”
Chairman Park’s voice rose sharply.
In truth, he was not all that angry about the U.S. tariffs themselves. What enraged him most, what made his eyes roll back, was Asan Motors building factories in America.
Along with construction, automobile manufacturing was the industry that contributed most to boosting the domestic market. A single factory had hundreds of thousands of livelihoods attached to it.
At present, automobile-related jobs numbered 350,000, far more than semiconductors, and that was only counting direct workers. If one included workers in intermediate goods supplied to them, such as steel, glass, and wheels, it would not be an exaggeration to call it one million jobs. The reason America was glaring at them and demanding they build factories was because there were no jobs in manufacturing quite like these.
And yet that America had turned into a robber.
They poured on tariffs for petty reasons and stole factories away. From PASCO’s perspective, it felt as though tens of thousands of jobs were being taken from them.
Accordingly, Chairman Park had also conveyed his position to political circles through various channels, but the answer that came back was always the same.
There was no helping it...
“They’re practically holding a ritual for us to go under, aren’t they? Do they think automobiles will be fine if domestic steel collapses? Are they going to make K9 self-propelled howitzers with Chinese steel? Those damned bastards!”
As everyone lowered their heads with dark expressions, President Kim, who oversaw practical operations, burst out in anger.
“Chairman, this won’t do. If the government is going to act like this, we should just go bankrupt too!”
“President Kim...”
“We can’t hold out! Our market share has already been cut in half by Chinese dumping! And if Asan Motors moves its factories to America on top of that, where on earth are we supposed to supply our products? If they couldn’t avoid the tariffs, they should at least be building the factories domestically!”
With that as the starting point, all the executives rose up.
“Chairman, I agree with the president! If this is how things are, then we have nothing to lose either!”
“Starting tomorrow, we’ll accept voluntary retirement applications from all employees! We’ll cut off all subcontracting work too!”
“It’s not just us. The top three steel companies all said the same thing. If the government responds like this, we can’t hold out any longer!”
In truth, the bloodbath in the industry was already underway.
Asan Steel, one of the two pillars of the steel industry, had started accepting voluntary retirements first, and a considerable number of personnel had been cut away. PASCO, at least, had large reserves and had been able to endure until now, but it was impossible to continue any further. Now that it had been confirmed the government was standing by and doing nothing, they could no longer hold out.
Knock, knock.
Just as the mood in the conference room grew heated, a secretary carefully opened the door.
With a grave expression, he lowered his head, then carefully spoke to Chairman Park.
“I’m sorry to interrupt the meeting, Chairman, but someone from the pension fund is here.”
“Th-the pension fund? Was that on the schedule?”
“No. They came without notice.”
“Why all of a sudden?”
“They said they wanted to hear about our difficulties regarding the current U.S. tariff issue...”
“W-what?”
The eyes of Chairman Park and the executives flew wide open.
They had been waiting... They had been desperately hoping... Had the government finally moved?