RUNNING HEAD: KOREAN AUTO INDUSTRY: FUTURE OR DOOM?.
Korean Auto Industry: Future or Doom.
To try and predict the future or lack off, of the Korean Auto Industry we must first explore the past. It was a famous quote by George Santayana in The Life of Reason: "Those who do not remember the past are condemned to repeat it." And South Korea has never forgotten her past especially Japan. .
Imperial Japan occupied Korea from the late nineteenth century to about 1910. During The Second World War Japan again became master of the Korean peninsula. Japan's occupation was brutal - but at a time when Japan became a major world industrial power, and Korea learned as she suffered. The bitter memories of the occupation atrocities including the abduction of tens of thousands of Korean women carted off to serve as prostitutes for Japanese soldiers during the war still linger with Korea of today. .
But as her colonial masters controlled the Korean peninsula, the Japanese way of doing business was being assimilated and mutated into the "Chaebol". Chaebol is a Korean term for a conglomerate of many companies clustered around one parent company. Those conglomerates or Chaebol were encouraged to tailor their growth and production to meet the South Korean government objectives and were dependent of state-owned banks for credit they needed to operate and grow. From occupation and war to the world's 11th largest economy is what modern day Korea has transformed herself into by closely following the world's second largest economy - Japan.
The Japanese model: while halve the world was busy with the cold war and not trying to be economically competitive, Japan closed its doors to foreign imports and geared its economy towards export thus exploiting a lag in world competitiveness caused by communism and the cold war. South Korea like Japan before her walked into an opportunity and exploited it to help South Korea grow at a steady and constant pace.