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HOME TOPICS SEARCH ABOUT ME Korea is pushing and kicking its way into the multi-billion-dollar consumer goods market. |
technofile Al Fasoldt's reviews and commentaries, continuously available online since 1983 Time to learn Korean as the market shiftsBy Al Fasoldt Copyright © 1988, The Syracuse Newspapers Move over, Japan. Somebody else is taking your place. That's the message Japanese electronics companies have been worried about for years. They've watched as their Asian rival pulled a miracle out of a dead economy. And now they're seeing their fears come to life in Chicago. The thousands of Japanese attending the Consumer Electronics Show here don't even need to enter the huge convention halls to read the signs of change. They're written on nearby Lakeshore Drive, on the trunklids of cars. They say "Hyundai." They're written in the windows of the discount stores uptown. They say "Datron" and "Samsung" and "Goldstar." They say "Korea." The country that was once a backwater rice producer has emerged as the strongest contender for Japan's electronics crown. Like a tae kwan-do combatant hungry for a victory, Korea is pushing and kicking its way into the multi-billion-dollar consumer goods market. The brute-force tactics are working. Figures released before the show opened Saturday revealed that 25 percent of all microwave ovens sold in the United States come from Korea. Sales of just one of the Korean manufactuers, Samsung, were reported at $1 billion for 1987. Evidence of Korea's dramatic rise also came from an international study that was reported Friday. It said Korea's economy is growing at a rate of 17 percent a year -- about four times the rate of most other healthy national economies. But the best evidence is visible inside the McCormick Place convention center. In large displays that would take up the floorspace of an entire store, dozens of Korean manufacturers have pulled a surprise on their Japanese counterparts. Instead of trying to undercut the big Japanese companies by selling cheaply made electronics at low prices, the Koreans are meeting the Japanese head-on. They've introduced upscale TVs, VCRs, hi-fi components and hundreds of other products that have the look and feel -- and probably the quality -- of similar products from Japan. What makes them different is the price. Korean products are inexpensive compared with the same items from Japan, mostly because Korean workers are paid less than Japanese. Korea's move into higher-class goods comes much sooner than many Japanese had expected. A year ago, during last summer's show, an executive of one of Japan's largest electronics companies told me privately that the '90s would be the decade of Japanese-Korean competition at the low end of the electronics market. He said he was genuinely worried about how to deal with that kind of competition for the cheapest products, because his company was already cutting its profit margin as close as it could. But now that the Koreans are aiming higher, the Japanese may be unable to reverse themselves quickly enough to avoid losing money. The clear gainers from this two-nation competition are American consumers. We will find prices stabilizing somewhat, because Korea's currency is not rising against the dollar the way the Japanese yen has. And we will benefit doubly -- from Japanese research that has made its way into products made outside Japan, and from Korean manufacturing, which is now recognized as having generally excellent quality standards. It's a win-win situation for Americans. Even the Berlitz people will gain. "I've just realized what this sort of thing means to me," a New York public-relations expert told me after six weeks of intensive instruction in the Japanese language. "It means I've got to learn Korean, too." |