Third-Generation Chaebol

SAVE Investment was a major shareholder of Ford.

It was in a position to voice its opinions.

Of course, holding a 20% stake wouldn't allow it to control Ford's management strategy, but if Taewoo Motors achieved significant success in China, the situation could change.

Since I couldn't explain all of this to my grandfather, I spoke indirectly.

"First, we need to confirm how well our Taewoo Motors, produced in the Romanian factory, will perform in the Chinese market."

"If the sales of finished cars are strong, do you think we could establish a joint venture with Ford?"

"If we achieve good results, we won't even need to take the initiative. Wouldn't American automakers, who lack small car models, reach out to us first?"

"Haha, that's a very optimistic way of thinking. Yes, young people should be positive."

My grandfather gave a hearty laugh.

It seemed like most of his disappointment had faded, but to fully lift his spirits, I delivered another piece of good news.

"Additionally, we may be able to secure more loans from Wall Street under the same conditions as before."

"You mean on the condition that we repay the expensive private loans?"

"Even just doing that will significantly reduce our annual interest payments."

There's nothing more wasteful than money lost to interest.

Especially when private loan interest rates exceed 15%—it was beyond wasteful.

That's why I planned to provide part of SAVE Investment's funds to Taewoo Group in the form of a loan.

"Haha, that's great. It pained me to see money being siphoned away by loan sharks, so this is excellent news."

"Moreover, we arranged to lend the funds in Korean won instead of dollars."

"Wouldn't it be better to borrow in dollars? According to economic officials and professors, the exchange rate could drop to 300 won per dollar. If that happens, the amount we need to repay would be cut in half, wouldn't it?"

No wonder the country faced a financial crisis.

An exchange rate of 300 won per dollar? And those predictions were coming from highly regarded scholars in the economic field.

According to them, if the exchange rate dropped to 300 won, the amount of debt that needed to be repaid in dollars would be halved.

But history didn't unfold that way.

Far from reducing the debt, it tripled.

In just a year, the exchange rate skyrocketed from 700 won to 2,000 won per dollar.

Taewoo Group's debt, which had stood at 20 trillion won, soared to 80 trillion won after the financial crisis.

I could somewhat understand why they made such claims.

At the time, South Korea was experiencing annual economic growth of over 10%.

However, starting this year, economic growth was set to slow significantly.

That's why I insisted on lending in Korean won.

My grandfather, unaware of my reasoning, preferred borrowing in dollars.

"No one can predict how the value of the dollar will change. That's why I believe borrowing in won is the better option."

"Hmm, well, do as you see fit. You've achieved results, so I should trust your judgment. So, how much can we borrow?"

"We can secure an additional 3 trillion won. That should be enough to pay off most of Taewoo Group's private loans and the high-interest debts from secondary financial institutions, don't you think?"

"Haha, our expenses will decrease significantly. We'll be able to save at least several hundred billion won per year. You've accomplished something truly remarkable."

The annual interest payments alone amounted to at least a trillion won.

Moreover, to cover those interest payments, we had been taking on even more loans, causing the principal debt to keep growing.

To break this vicious cycle, I utilized SAVE Investment's funds.

Of course, that alone wouldn't be enough to completely sever the cycle.

For Taewoo Group to sustain itself, we needed a self-sufficient system, products that would be embraced by the market, and a stable supply chain.

***

As the sun gradually set, I realized I was still at work.

Since I held the highest position in the Planning Department, no one else was leaving either. Not wanting to hold them up any longer, I gathered my things and stood up.

"Everyone, head home. From tomorrow onward, don't wait for me—just leave when you're done with your work."

"But, sir, how could we leave before you do?"

From the Planning Director's response, I could immediately grasp the company's current atmosphere.

A rigid, hierarchical structure, much like the military.

Taewoo Group's corporate culture was highly stiff and formal.

I couldn't change such a deep-rooted culture overnight, so the best I could do was start by leaving early myself.

"Then I'll head out first. Everyone, have a good evening."

"See you tomorrow."

With no other choice, I made my way to Captain Kang's office to take care of some remaining business.

It was the same situation there—just like at Taewoo Group, overtime work was in full swing.

Even Team Leader Han, who was supposed to be in Japan, had somehow already returned and was deep in work.

"You've already wrapped up the business in Japan?"

"The negotiations ended much more smoothly than expected. In exchange for nullifying the derivative contracts, we secured full ownership of MCA Records. As a bonus, we also acquired a few audio-related patents."

That's exactly why I pay Han a high salary.

He understands what I want without needing explicit instructions, which is why he earns what he does.

"Great work. So, MCA Records is now officially ours?"

"There are still a few procedural details to finalize, but overall, SAVE Investment now owns MCA Records."

"Then let's use MCA Records to build a system where people can purchase or rent music online."

Acquiring MCA Records wasn't just a random decision.

It was part of a plan to dominate the upcoming MP3 market.

"Are you saying we should create an online music platform?"

"We just need to hire IT experts to develop it. As for related patents, we can commission Taewoo Group's technology research lab."

"That's not what I meant. Will the U.S. recording industry even allow this? And won't artists reject the idea of distributing their music online?"

"That's why we're going to start very small. The site's accessibility will be terrible, and we won't do any marketing. Our only goal is to establish proof that such a platform exists and that digital music can be purchased legally."

Trying to take on too much from the start would only lead to failure.

Apple would need at least another year or two to develop the iPod.

This platform was just a preparatory step.

"In that case, it should be feasible."

"With the internet becoming mainstream, illegal music-sharing sites will start popping up like mushrooms. When that happens, people will realize the need for a legitimate platform."

"I'll get started on developing the music site as soon as possible and quietly integrate it into the bottom corner of MCA Records' official website."

As expected, Han handled everything efficiently, neatly, and with impeccable judgment.

"Also, please finalize the loan for Taewoo Group."

"I've already transferred 3 trillion won into a Korean bank. As soon as the contracts are signed, the funds will be sent to Taewoo Group."

I noticed that the dark circles under Han's eyes had grown even deeper.

Traveling back and forth between Korea and Japan, he probably hadn't had a proper break in a long time.

I wanted to give him some time off, but...

With only a year left before the financial crisis hit, that wasn't an option.

Instead, I'll just pay him a higher salary. Hang in there a little longer.

Time passed, and April had arrived.

During this period, the sales of Taewoo Shipbuilding and the mobile phone division had been finalized.

All of the proceeds were tied up in the joint venture with Aramco.

Since my grandfather had a tendency to spend money whenever he had it, I had to resort to these kinds of tricks to prevent unnecessary outflows.

As I whistled while reviewing the declining debt ratio of Taewoo Group, the Planning Director entered my office with a thick stack of reports.

At the beginning of every month, he provided a detailed briefing on the status of each subsidiary—a process that often took up an entire day.

I felt a little sorry for him, but I mechanically nodded along as he went through the reports.

Then, something completely unexpected made me sit up straight in my chair.

"Can you repeat that? What did you say was completed?"

"Are you referring to the electric vehicle? Taewoo Motors has completed the development of the TEV-4. The launch event is scheduled for April 20th at the Bupyeong automobile plant. It was developed with commercialization in mind, but since it's about twice as expensive as a regular passenger car, we don't anticipate high sales numbers."

I turned my head toward the calendar.

It was definitely April 1996.

An electric vehicle? As far as I knew, mass production of electric cars wouldn't succeed for another ten years.

Tesla, the company that would become synonymous with electric vehicles, hadn't even been founded yet.

At SAVE Investment we had been quietly investing in the engineers who would later go on to create Tesla, building connections for the future.

And yet, an electric vehicle had already been developed.

Not just a prototype, but one designed for commercial production.

"What are the TEV-4's specifications?"

"It has a maximum driving range of 300 km, a peak output of 95 horsepower, a top speed of 120 km/h, and a 0 to 100 km/h acceleration time of 15 seconds."

"Still quite lacking."

"True, but while other companies have only built concept prototypes to showcase their technology, we've actually developed an electric vehicle that can be sold to the public."

I had expected too much when I heard the words "commercial electric vehicle."

Upon reviewing the details, it was clear that there were still limitations preventing full-scale commercialization.

However, the mere fact that Taewoo Motors had already entered the electric vehicle market was astonishing.

It aligned perfectly with the future I had envisioned for Taewoo Motors.

Over time, the entire automotive industry would inevitably dive into developing either electric or hydrogen-powered vehicles.

Getting a head start and securing technological capabilities early on was never a bad move.

"I didn't know the Chairman (grandpa) was interested in electric vehicles as well."

"He once mentioned that the era of electric cars would come someday."

My grandfather's foresight was truly remarkable.

If Taewoo Group hadn't collapsed due to the foreign exchange crisis, it might have fundamentally reshaped the industry.

Although we often clashed over the debt issue, I had to acknowledge his exceptional business acumen.

"Continue with the electric vehicle project. It may not be profitable right now, but as the Chairman said, the era of electric cars will come eventually."

"A significant number of personnel have already been assigned to develop our own electric motors. Someday, Taewoo will be able to manufacture electric vehicles using only our in-house technology."

Should I accelerate the timeline?

Perhaps I should meet with Tesla's founders a bit earlier?

…No, it still wasn't the right time.

At the very least, this was something to revisit after the foreign exchange crisis had passed.

For now, the best course of action was to focus on battery development—for both electric vehicles and mobile phones.

"I heard that the cars produced in Romania have begun entering the Chinese market. How's the response?"

"It's better than expected. Thanks to support from the Chinese government, import tariffs are relatively low, giving us a significant price advantage over other foreign automakers. Although production volume is still limited, most of the completed vehicles have already been sold."

So, the reception was good?

It was a bit of a workaround, but we had successfully entered the Chinese market.

Now, at last, we were minimally prepared to bait Ford with the idea of a joint venture.