Execution of 73 Trillion KRW for New and Expanded Domestic Production Facilities by Next Year
25 Trillion KRW Investment in BBC Sector R&D Over the Next 5 Years
Recruitment Scale Increased by 50% Year-on-Year This Year... Securing BBC Momentum
[Asia Economy Reporter Choi Seoyoon] SK Group has decided to invest 67 trillion won over the next five years in regions outside the Seoul metropolitan area, including Seoul, Gyeonggi, and Incheon. Additionally, from this year through next year, the group will pour a total of 73 trillion won into facility investments, including expanding existing domestic factories and starting new construction. To secure technological competitiveness for SK Group's major affiliates, 25 trillion won will be invested solely in research and development (R&D) over the next five years.
On the 14th, SK Group announced its domestic investment and R&D plans aimed at strengthening the domestic infrastructure and technological competitiveness of its core growth engines: semiconductors (Chip), batteries (Battery), and bio (Bio), collectively known as the BBC industries.
Of the 179 trillion won SK Group plans to invest domestically over the next five years, 67 trillion won will be allocated to non-metropolitan areas to contribute to regional economic revitalization and balanced national development. The investment sectors include ▲semiconductors and materials 30.5 trillion won ▲green energy 22.6 trillion won ▲digital 11.2 trillion won ▲bio and others 2.8 trillion won, aligned with SK Group's core growth engines.
SK Group cited recent examples of non-metropolitan investments such as SK Hynix's plan to invest a total of 15 trillion won over the next five years in a new semiconductor production plant, M15X (eXtension), in Cheongju, as well as investments by SK Siltron, SK Inc. Materials, and SK E&S.
In particular, SK Group views concentrated investment in domestic production facilities, which are the growth foundation of its major affiliates, as necessary to proactively respond to ongoing economic crises and geopolitical risks. Accordingly, it plans to spend a total of 73 trillion won over the next two years, this year and next.
The domestic investments to be made by next year will also focus on the BBC industries, with allocations of ▲semiconductors and materials 48.7 trillion won ▲green energy 12.8 trillion won ▲digital 9.8 trillion won ▲bio and others 2.2 trillion won.
SK Telecom and SK Broadband will invest approximately 5 trillion won nationwide from this year through next year to expand 5G and other wired and wireless communication networks. SK E&S will invest more than 1 trillion won nationwide by next year to build renewable energy facilities such as solar and wind power, as well as city gas facilities. The nationwide network expansion by wired and wireless communication companies is a sector where SK Group’s first- and second-tier partners, as well as local small and medium-sized enterprises, can achieve mutual growth, and a ripple economic effect is expected from SK Group’s investments.
Furthermore, SK Group believes that securing differentiated technological capabilities is paramount to leading the Fourth Industrial Revolution era. Therefore, it plans to invest 25 trillion won in R&D over the next five years, including ▲semiconductors and materials 22.1 trillion won ▲green energy 800 billion won ▲digital 1.2 trillion won ▲bio and others 1.1 trillion won.
Meanwhile, SK Group plans to hire more than 13,000 people this year, the largest scale ever. This year’s hiring scale has increased by 50% compared to last year’s 8,500 hires. The increase in hiring is aimed at securing momentum for the BBC industries. In particular, the battery business within the BBC industries hired more than 1,000 people this year to respond to the rapid growth of the electric vehicle market.
An SK Group official said, “We will continuously expand and newly build domestic facilities, which are the production base of SK Group’s core strategic industries such as semiconductors, batteries, and bio, and make large-scale investments in R&D to lead the global market. We will also proceed with the planned mid- to long-term investments without delay to create domestic employment and achieve mutual growth with so-called materials, parts, and equipment (SoBuJang) partner companies.”
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