Vice Chairman Jang Se-wook Continues to Lead the Color Coated Steel Sheet Market Gap

Strategic Placement of Production Executives with Sales Capability
Operating Profit Margin Increased Last Year... Operating Profit Expected to Expand This Year

[Asia Economy Reporter Hwang Yoon-joo] Jang Se-wook, Vice Chairman of Dongkuk Steel, has set a strategy to maintain the color steel sheet super-gap this year through strengthening sales of color steel sheets and discovering new demand.

On the morning of the 5th, Vice Chairman Jang met with reporters on his way to work and said, "This year, we will increase profitability by expanding sales of premium color steel sheets and inkjet print steel sheets," adding, "Production of inkjet print steel sheets has stabilized, and this year we will focus on securing sales."

The reason Vice Chairman Jang conducted cross personnel changes between executives in charge of color steel sheet production and frontline sales executives at the end of last year is also for this purpose. Representative examples are Executive Directors Joo Yong-jun and Park Sang-hoon, both engineers by background. Executive Director Joo moved to the Busan plant three years ago as a cold-rolled sales manager. In this reshuffle, Vice Chairman Jang returned Executive Director Joo, who gained sales experience, to the Busan plant and transferred Executive Director Park, who was in charge of the Busan plant, to the cold-rolled sales office.

Vice Chairman Jang explained, "Since field executives have also experienced sales, there is an advantage in being able to apply what customers want directly on site."

According to the Korea Iron & Steel Association, Dongkuk Steel holds the number one market share in the domestic color steel sheet market with 30%. There is a significant gap compared to competitors KG Dongbu Steel (23%) and POSCO Steel Sheet (20%). The domestic color steel sheet production scale (as of 2018) is 2.27 million tons. Dongkuk Steel produces 750,000 tons annually, accounting for one-third of the total production volume.

The main contributor to Dongkuk Steel's position as a leader in the color steel sheet market is Vice Chairman Jang. Dongkuk Steel completed the first domestic color steel sheet production line in 1972. When Vice Chairman Jang was appointed president of Union Steel in 2010, the color steel sheet business took a leap forward. At that time, Vice Chairman Jang was the first in the steel industry to start brand marketing for products. The results were the launch of the color steel sheet "Luxsteel" in 2011 and the home appliance color steel sheet "Appsteel" in 2013. Dongkuk Steel is the only steel company with a dedicated product design team.

The reason Vice Chairman Jang focuses on color steel sheets is that he considers them strategic products that can achieve differentiation in an oversupplied market. As a result, despite difficulties last year due to the US-China trade dispute, oversupply, and downturn in upstream industries, Dongkuk Steel's operating profit margin reportedly increased. Vice Chairman Jang expressed confidence, saying, "Operating profit will improve further this year."

However, first-quarter performance is expected to shrink. Vice Chairman Jang said, "The impact of the novel coronavirus infection (Wuhan pneumonia) seems to be greater than expected," adding, "The first quarter traditionally is the off-season for the steel industry due to the lack of large construction projects and the long Lunar New Year holiday, and demand may shrink further due to the novel coronavirus impact." Dongkuk Steel's production plant in China will also suspend operations until the 9th in accordance with the Chinese government's policy.

Meanwhile, the decision on whether to expand color steel sheet production, which Vice Chairman Jang announced last year, is expected to be made after the second quarter. This is due to concerns about economic contraction caused by the novel coronavirus and the possibility that expansion could lead to a drop in product prices. Vice Chairman Jang said, "The review related to expansion has been completed, and we are monitoring the situation," adding, "Maintaining domestic market production capacity is important, but KG Dongbu Steel is preparing four color steel sheet lines in Dangjin, so we are considering this carefully."

This content was produced with the assistance of AI translation services.