Korean companies ramp up production in China to meet demand

Winia Electronics logo [Courtesy of Winia Electronics]

Korean companies operating in China are ramping up their production to meet pent-up demand as Asia’s biggest economy is emerging from the pandemic and re-opening its borders.

According to sources on Wednesday, Winia Electronics Co., a Korean company which runs a home appliance factory in Tianjin, is scheduled to reopen a line for small refrigerators at the end of this month and another line for microwave ovens next month. The company’s products manufactured in Tianjin are exported throughout Asia.

Hyosung TNC Corp. completed 160-billion-won ($126.6 million) expansion of a production line at a spandex plant in Ningxia, China at the end of last year. As Chinese consumption revives, the price of the company’s general-purpose spandex product 40D jumped by about 8 percent in one week after the Lunar New Year holiday. Inventory of spandex fell to 28 days in China from 35 days. The company’s factory utilization rate, which stood at 63 percent at the beginning of last month, has recently jumped to 82 percent.

Hankook Tire & Technology Co. is weighing the timing of increasing production at its factory while closely monitoring the situation. With movement restrictions between provinces in China lifted, car traffic will increase, and accordingly demand for tires will follow. The company plans to increase production to meet demand.

With more factories opening again in China, there are growing expectations for a recovery in the real economy.

Domestic and international organizations recently raised their forecasts for China’s economic growth. The International Monetary Fund estimated China’s economy could rise 5.2 percent this year, an upgrade from its earlier forecast of 4.4 percent.