Korean Businesses in India Hit by COVID Crisis
10 May, 2021
Korean businesses in India have already been hit hard by the huge surge in coronavirus infections there.
With a population of 1 1.4 billion people, India ranks among the world's top three markets together with the U.S. and China, but 403,738 new infections were reported there on Saturday alone, forcing around 700 Korean companies there to send non-essential staff back again to Korea and also have essential employees home based.
Hyundai, which has a factory in Chennai, is halting production from Monday to Saturday for facility repairs that were traditionally done in the summertime holidays. "Our production is not directly affected yet, but increasingly more areas are being locked down and only around 20 percent of our dealers will work," a staffer said.
Following the U.S. and China, India is the third major market for the Korean automaker and the only person where its overseas sales rose this past year.
Samsung's mobile business is also busy revising its global sales strategy as a result of crisis. In the first quarter of the year, Samsung rose to the No. 2 spot after Xiaomi. It released a cheaper version of the Galaxy smartphone for Indian consumers and the strategy paid handsomely.
But lockdowns in large swathes of the united states have impacted online sales and parts supplies. The company aimed to grab a bigger slice of the marketplace through aggressive marketing in the next quarter, but the crisis has ruined the plans.
LG has slashed its production targets in home appliance factories in Noida and Pune. The top of 1 Korean company with a factory in India said, "Most Korean companies have practically given up on their first-half earnings targets."
A straight bigger problem is that ships that stopped in Indian ports are banned from docking in other parts of the world. At the moment, around 240,000 out of 1 1.6 million merchant vessel crew all over the world are Indian nationals.
Based on the Financial Times, Ningbo-Zhoushan Port in China, which is the busiest on earth regarding cargo volume, has blocked ships and crew that stopped over in India during the past 90 days, as have Singapore and the UAE, which are home to the world's second and third-largest ports.
Lee Chul-jung at the Korea Shipowners' Association said, "If the COVID-19 crisis in India continues for some more months, shipments to the world's second most populous country will be blocked, impacting the entire global shipping network."
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