[CEO Rivals] 'Joseon Throne' Clash Between 'Archrivals' Kim Dong-gwan and Jeong Gi-seon

Hanwha's Kim Dong-kwan and HD Hyundai's Jeong Gi-seon, the close third-generation business friends
Full-fledged competition after Hanwha's entry into shipbuilding

"Transition to eco-friendly business, the group's future growth engine"
Two CEOs sharing the same insight

"Hyundai Heavy Industries Group, which has grown to become the world's No.1 shipbuilder over the past 50 years, will transform into a 'Future Builder' creating new value for humanity." (Jung Ki-sun, President of HD Hyundai, at CES2022)

"Hanwha will respond to global climate change with the belief that small developments can bring about great changes." (Kim Dong-kwan, Vice Chairman of Hanwha Group, at the 2021 P4G Summit)

These are the words of Kim Dong-kwan, Vice Chairman of Hanwha Group, and Jung Ki-sun, CEO of HD Hyundai, who have taken the lead in management. The two CEOs are envisioning a new future for their groups through a transition to eco-friendly businesses in the carbon-neutral era. Being of similar age and having family ties dating back to their fathers' generation, the two CEOs are said to be close friends. However, rumors say that this changed after Hanwha Group entered the shipbuilding industry.

Kim Dong-kwan, Vice Chairman of Hanwha Group (left), and Jung Ki-sun, President of HD Hyundai, are conversing at a dinner meeting for accompanying businesspeople held on the 22nd (local time) at a hotel in Hanoi, Vietnam. Photo by Yonhap News

◆Proving management skills by leading new businesses, Kim Dong-kwan=Third-generation business heirs often shy away at just hearing the names of Jung Ki-sun (42), President of HD Hyundai, and Kim Dong-kwan (41), Vice Chairman of Hanwha Group. The two are representative 'Eomchin-ah' (literally "mom's friend's son," meaning a perfect man in every aspect) in the business world. They are widely praised for their excellent academic records, gentle and unpretentious personalities. Unusually among heirs, both completed military service as officers: Jung as an ROTC officer and Kim as an Air Force interpreter officer. Other third-generation heirs get annoyed when compared to these two CEOs.

Kim Dong-kwan was called a prodigy from a young age. He never lost the top spot in his entire school from middle school onward. He graduated from the prestigious American private school Saint Paul's High School and was a member of the 'Cum Laude Society,' which selects outstanding students. He majored in Political Science at Harvard University and served as president of the Korean Student Association during his studies.

After completing his military service, Kim joined Hanwha Corporation in 2010 as a deputy general manager. The following year, he moved to Hanwha SolarOne as head of planning and led the solar power business. In 2012, he spearheaded the acquisition of Hanwha Q CELLS, and by 2014, he achieved a turnaround to profitability. He elevated Hanwha Q CELLS to become the No.1 solar power company in key countries such as Korea, the U.S., and Japan. In 2020, he launched Hanwha Solutions by merging Hanwha Chemical, Q CELLS, and Advanced Materials. Since then, he has held roles such as CEO of Hanwha Solutions' Strategy Division, head of Hanwha's Strategy Division, and team leader of Hanwha Aerospace's Space Hub, playing a major role in strengthening the group's new business competitiveness, and was promoted to vice chairman last year.

He is known for never putting down books and often studies or holds discussions on new businesses with employees. It is said that boxes of books were delivered to Vice Chairman Kim's office several times a month. He reads not only management books but also books from various fields and is known for gifting books to his staff. When preparing for the solar power business, he formed a study group with employees to build specialized knowledge. Kim's leadership in leading new businesses such as solar power and aerospace as Hanwha Group's core businesses is credited to his continuous study and discussion attitude.

◆Humble like his grandfather and father, Jung Ki-sun=Jung Ki-sun studied well like his father, Chairman Chung Mong-joon. He graduated from Daewon Foreign Language High School and Yonsei University with a degree in Economics.

He followed an elite path, completing an MBA at Stanford University, but Jung is widely recognized for his 'unpretentious leadership.' He respects his late grandfather, Chairman Chung Ju-yung, and humbles himself before company executives, speaking politely even to subordinates. When he needs to learn something, he makes time in his schedule to study.

He often makes surprise visits to Avikus, the group's autonomous ship operation specialist company. Jung believes the autonomous navigation system will lead the group's new innovation and shows great affection for Avikus. He personally buys donuts from a famous donut shop near HD Hyundai's headquarters in Gye-dong. He asks about difficulties and communicates openly with employees about technology development. Avikus employees were reportedly moved when they heard Jung personally bought donuts.

After his MBA, Jung worked at Boston Consulting Group (BCG) Korea before rejoining Hyundai Heavy Industries in 2013 as a general manager. He was promoted to managing director in the planning and finance division, becoming the youngest executive in the business world at the time. Within a year, he was promoted to senior managing director, overseeing key departments, and two years later, he was promoted to vice president and appointed CEO of Hyundai Global Service. Since its launch in December 2016, HD Hyundai Global Service has been regarded as Jung Ki-sun's 'management test ground' because he strongly advocated for and led the establishment of the company focused on eco-friendly ship retrofitting. In an April 2018 press conference, Kwon Oh-gap, Chairman of HD Hyundai Heavy Industries Group, said, "Hyundai Global Service was established because Jung Ki-sun strongly insisted on it since 2014. We entrusted him as CEO to prove his management capabilities by taking responsibility himself."

HD Hyundai Global Service recorded sales of 321.1 billion KRW and operating profit of 45.5 billion KRW last year, growing into a promising company within the group. Currently, Hyundai Global Service is the only company in the global ship market providing comprehensive management services throughout the entire operational period of ships.

Kim Dong-kwan, Vice Chairman of Hanwha Group, is greeting employees during his visit to Hanwha Ocean Geoje Plant on the 7th of this month. Photo by Hanwha Ocean

◆How did the 'close Eomchin-ah' become rivals?=Their fathers, Kim Seung-yeon, Chairman of Hanwha Group, and Chung Mong-joon, Chairman of the Asan Foundation, were classmates at Jangchung Elementary School in Seoul. Due to this connection, Jung took care of Kim's grandmother's funeral in 2016, and Kim personally attended Jung Ki-sun's wedding in 2020 during the COVID-19 pandemic, showing their friendship.

Once known as the business world's representative 'close friends,' the two CEOs have now become competitors vying for 'shipbuilding and marine supremacy.' The rumors and gossip about their friendship indicate that a fierce competitive relationship and psychological warfare have formed. Only the two know the true nature of their friendship. Until now, Hanwha and HD Hyundai operated in different business areas with no competition, but the situation has changed. Besides shipbuilding, they now clash in growth industries such as defense and solar power.

Their rivalry ironically stems from the same insight: the belief that transitioning to eco-friendly businesses will be the future growth engine in the carbon-neutral era. They are expanding their battle lines by not only thinking but also executing through investments and acquisitions in new businesses. Both leaders are flexible and focused on the global carbon-neutral trend, not settling for their groups' traditional core businesses?defense and petrochemicals for Hanwha, shipbuilding for Hyundai Heavy Industries.

Jung Ki-sun, President of HD Hyundai, expressed his gratitude to employees with family members who are war veterans at the HD Hyundai Electric transformer plant located in Montgomery, Alabama, USA, in April this year. Photo by HD Hyundai

◆Competition over 'shipbuilding supremacy' intensifies=The two companies are expected to compete especially around eco-friendly ships. The competition is fierce not only in orders but also in securing the next-generation eco-friendly ship market. Ahead of the carbon-neutral era, the International Maritime Organization (IMO) and major governments are tightening marine regulations. They are now focusing on developing ships powered by LNG (liquefied natural gas), methanol engines that emit less carbon, as well as ammonia and hydrogen propulsion.

Hanwha Group first clashed with HD Hyundai in the bidding war for ship engine manufacturers when pursuing the acquisition of Hanwha Ocean. Eventually, HD Hyundai settled on acquiring STX Heavy Industries, while Hanwha chose to acquire HSD Engine. HD Hyundai aims to expand its product lineup by including not only large engines from HD Hyundai Heavy Industries' engine division but also small and medium engines from STX Heavy Industries to enhance business competitiveness. Hanwha Ocean signed a memorandum of understanding in February this year to acquire a 33% stake in HSD Engine through Hanwha Impact, aiming for vertical integration.

Both companies are fiercely competing to secure talent to support strong order performance and new business initiatives. Hanwha Ocean is conducting open recruitment for experienced professionals without size limits until the end of the year. They plan to revise their wage system to offer salaries comparable to competitors. As ships ordered in the past one to two years begin construction this year, competition for manpower in the shipbuilding industry is expected to intensify further.