Kolon 4th Generation Lee Gyu-ho Takes Full Charge of Mobility Management... Kolon Global Splits Construction and Automotive Divisions

Vice President Lee Gyu-ho, Kolon Global. Photo by Kolon Global

[Asia Economy Reporter Donghoon Jeong] Kolon Global is accelerating future growth by splitting its construction and automobile divisions. In particular, with this decision, Lee Gyu-ho, vice president and the eldest son of honorary chairman Lee Woong-yeol of Kolon Group and the fourth generation of the 'Kolon family,' will take charge as co-CEO of the newly established corporation, stepping fully into management.

According to Kolon Global on the 21st, the Kolon Global board decided the day before to split the construction and trading divisions into Kolon Global Co., Ltd. and the automobile division into a newly established company, Kolon Mobility Group Co., Ltd. Accordingly, the imported car division, including BMW, Audi, Volvo, Jeep, and Rolls-Royce, will be split into the new company Kolon Mobility Group Co., Ltd., while the existing construction and trading divisions, Kolon Sporex, and other subsidiaries will remain with the continuing company Kolon Global Co., Ltd.

Kolon Global will split the continuing and newly established companies based on asset value at a ratio of 75 to 25 on January 1 next year and will establish and relist Kolon Mobility Group.

The company stated, "The purpose of this split is to accelerate future growth through swift and efficient decision-making in a rapidly changing market environment," adding, "We will secure growth engines through selection and concentration and enhance corporate and shareholder value."

Kolon Mobility Group plans to restructure and expand its business model centered on imported car distribution and sales to become a comprehensive mobility company. It will build a multi-brand by securing new brands in the SUV (Sports Utility Vehicle) and EV (Electric Vehicle) sectors and expand the mobility-related value chain beyond the existing offline-focused distribution to include premium subscription services and used car businesses.

Kolon Global’s automobile division has recorded an average annual growth rate of over 12% in vehicle sales from 2012 to this year, serving as a stable 'cash cow.' Even after the split, it is expected that corporate value will be reassessed through mid- to long-term innovations such as strengthening multi-brand presence, expanding networks, entering related new businesses, and building online platforms based on this performance stability.

The new company will also introduce various services and products to enhance customer value through synergies among businesses within the group. It plans to develop products and services linked to the group’s diverse leisure businesses such as hotels and golf courses and strengthen competitiveness by introducing differentiated customer membership programs.

In particular, Lee Gyu-ho, who has been leading Kolon Global’s automobile division, will focus on establishing future growth strategies, discovering new businesses, and strengthening financial capabilities as co-CEO of the new company. Jeon Cheol-won, former head of the BMW division and vice president, will serve as the other co-CEO, laying the sales foundation of the new company by managing sales and A/S networks centered on existing businesses. The goal is to achieve KRW 3.6 trillion in sales and KRW 100 billion in operating profit by 2025.

The continuing company, Kolon Global, also views this split as an opportunity to improve investment efficiency. In addition to the existing order backlog exceeding KRW 10 trillion, by actively promoting eco-friendly energy businesses, it expects to achieve new orders of KRW 4 trillion, sales of KRW 3.8 trillion, and operating profit of KRW 290 billion by 2025.

Especially in the construction division, it plans to expand high-profit development projects such as joint ventures and proprietary projects based on OSC (Off-Site Construction). It will also expand the country’s top-level onshore and offshore wind power projects and continue sustainable growth as an eco-friendly company through wind-based power and hydrogen energy production.

A Kolon Global official said, "Since merging the construction, trading, and automobile divisions in 2012, we have maintained stable growth through business synergy, but considering the rapidly changing management environment recently, we decided to split the company," adding, "Even after the split, we plan to continue growth by maximizing efficiency and implementing tailored growth strategies, sharing profits with shareholders."

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