Lee Jae-yong Style 'Aggressive Management' Samsung Electronics Semiconductor Investment Significantly Increased

Sharp Increase in Semiconductor Manufacturing Equipment Imports in March
Samsung Electronics Vice Chairman Lee Jae-yong: "We Must Strengthen Future Investments Especially in Difficult Times"

Lee Jae-yong, Vice Chairman of Samsung Electronics

[Asia Economy Reporter Changhwan Lee] Despite the global economic downturn caused by the novel coronavirus disease (COVID-19), Samsung Electronics has significantly increased its semiconductor facility investments. This is interpreted as a reflection of Vice Chairman Lee Jae-yong's (photo) recent continuous emphasis on the management will that "the more difficult the situation, the more we must strengthen investments for the future."

According to the Ministry of Trade, Industry and Energy and the Korea Customs Service on the 3rd, South Korea's imports of semiconductor manufacturing equipment last month amounted to approximately $1.1 billion (about 1.35 trillion KRW), a 154% increase compared to the same period last year. The import value of semiconductor manufacturing equipment rose sharply for two consecutive months, following about $700 million (about 860 billion KRW) in February, which was a 67% increase year-on-year.

Most of the semiconductor manufacturing equipment imports are estimated to be for Samsung Electronics. Recently, Samsung Electronics completed and began full-scale operation of an extreme ultraviolet (EUV) dedicated semiconductor production line in Hwaseong. They are also constructing a new semiconductor production line in Pyeongtaek.

It is analyzed that the construction of new lines at major business sites has generated demand for the import of the latest semiconductor manufacturing equipment from overseas companies.

An industry insider said, "The significant increase in South Korea's semiconductor manufacturing equipment imports means that Samsung Electronics is making substantial facility investments," adding, "It appears that investments are being executed as planned despite the uncertain economic conditions caused by COVID-19."

Samsung Electronics' semiconductor facility investment, which remained around 13 trillion KRW until 2016, began to surge from 2017 and recorded 22.5649 trillion KRW last year. The fact that facility investments increased by more than 70% in just four years reflects Vice Chairman Lee's proactive investment will.

Two years ago, Vice Chairman Lee announced an investment of 180 trillion KRW in new industries including semiconductors by 2021. Last year, he showed aggressive management will by announcing the 'Semiconductor Vision 2030,' which includes an investment of 133 trillion KRW to achieve the world's number one position in system semiconductors by 2030.

As his first management move of the new year, Vice Chairman Lee visited the semiconductor research center at Samsung Electronics' Hwaseong plant and in February visited the Hwaseong EUV line to encourage semiconductor investments, publicly signaling his intention to expand the semiconductor business multiple times.

Samsung Electronics is also actively recruiting semiconductor personnel. On the 19th of last month, Samsung Electronics posted a recruitment notice seeking experienced employees for 51 positions across 10 organizations in the DS (Device Solutions) division responsible for the semiconductor business. Samsung Electronics usually conducts occasional experienced hires by organization within the semiconductor division, but this year it is recruiting experienced workers across the entire division.

The number of planned hires is said to be the largest ever. It is known that the semiconductor division increased its hiring by more than 2,000 people last year.

A Samsung Electronics official emphasized, "Semiconductor investments will be flexibly adjusted according to market conditions as announced at the beginning of the year," adding, "Investments to strengthen mid- to long-term competitiveness in future growth businesses such as system semiconductors, displays, artificial intelligence (AI), and 5G communications will be executed as planned without any setbacks."