'Wuhan Risk' Grows for Korean Companies, Employee Repatriation and Business Trip Bans... Concerns Over Disruptions to China Operations (Comprehensive)

[Asia Economy Reporters Hyewon Kim and Soyeon Park] As the novel coronavirus infection (Wuhan pneumonia) spreads not only throughout China but also worldwide, Korean companies are on high alert, swiftly preparing countermeasures. A significant number of employees dispatched to China have returned to Korea and are currently under self-quarantine (working from home), and business trips to China have effectively been suspended.

According to industry sources on the 28th, Korean companies with subsidiaries or factories in China, such as Hyundai Motor, Samsung, SK, LG, POSCO, and Doosan, have established emergency response systems by creating and distributing manuals to respond to the novel coronavirus. Generally, companies have taken initial measures such as recalling dispatched personnel, requiring home-based work for those entering or leaving China, banning business trips, and installing thermal scanners. A group official stated, "The atmosphere before and after the Lunar New Year holiday has completely changed," adding, "The companies' response scenarios have also been strengthened in several stages."

Hyundai Motor Group has issued cautionary measures, recognizing the risk of the novel coronavirus spreading at the Kia joint venture factory in Yancheng, Jiangsu Province, China. The group is also responding by sharing emergency contact networks across all its affiliates operating in China to prepare for any incidents and has prepared response scenarios for potential worsening situations.

According to Korean community organizations, Hyundai Motor Group has recommended the temporary return of families of Hyundai Motor and partner company expatriates stationed in China through an urgent notice. Families of expatriates residing in China are to return to Korea temporarily, and Hyundai Motor expatriates currently in Korea are advised to postpone entry into China.

For Hyundai Motor expatriate families returning to Korea, they have been instructed to avoid external contact such as visiting relatives, acquaintances, or workplaces for one week after arrival and are advised not to re-enter China until further notice.

Samsung Electronics immediately formed a task force (TF) at its headquarters and is sending preventive text messages to all employees while installing thermal scanners at each workplace. A Samsung Electronics official stated, "We have created group chat rooms at the factory or workplace level to provide real-time updates on the novel coronavirus."

SK Group, which has SK General Chemicals operating in Wuhan, the outbreak city, recalled all local dispatched employees before the closure of Wuhan Airport and recently mandated that employees with recent travel history to China work from home for at least 10 days upon return, even if they show no symptoms.

POSCO, which also has a business site in Wuhan, has advised local employees to limit movement within China and is currently reviewing the withdrawal of all expatriates in consultation with the government. A POSCO official said, "As the Chinese government extended the Lunar New Year holiday period until February 2, the suspension of local factory operations has also been extended accordingly." Doosan Bobcat, with a factory in Suzhou, China, has entered a forced leave period until February 8 following local government guidelines.

Shinsegae International has decided to temporarily close its Shanghai subsidiary. The company explained, "There is one Tomboy and one BOB offline store each in Wuhan, both of which have been closed since the 24th, with reopening dates undecided," adding, "Masks will be sent from Korea for local Chinese employees."

Business trips to China are being refrained from for the time being. LG Electronics, which initially issued a ban on business trips to China, has now completely prohibited trips not only to Wuhan but throughout China starting today. LG Display is also minimizing business trips to China and instructs employees to report via text messages before and after visits. Specifically, before visiting, employees must submit the purpose (personal or business) and duration, and after visiting, they must report any fever or other unusual symptoms. LG International decided to recall all families of expatriates stationed in China today. The company also completely banned business trips to China and instructed employees and their families who show suspected infection symptoms after visiting China to immediately report to the company and follow subsequent measures.

SK Innovation has immediately recalled employees on business trips in Wuhan and is minimizing business trips to other regions in China unless absolutely necessary. Cosmetic companies such as AmorePacific have also issued internal notices to refrain from business trips to China and require employees to justify the necessity of trips to their department heads if needed.

KOTRA, which operates 21 trade centers in China, held an emergency countermeasure meeting chaired by President Kwon Pyung-oh this morning, actively identifying difficulties faced by Korean companies operating in China and reviewing business plans. President Kwon stated, "We will soon decide whether to form a special task force in preparation for a prolonged situation." The Korea International Trade Association is comparing the current situation with the 2003 Severe Acute Respiratory Syndrome (SARS) outbreak and is assessing the potential long-term impact of the novel coronavirus on Korean companies' trade (exports and imports).