Chŏnsŏ Group
| Conglomerate | |
| Industry | Automotive |
| Predecessor | Winam Chŏnsŏ State Automobile Factory |
| Founded | July 15, 1968 in Winam, Hadong, Menghe |
| Headquarters | Chanam , |
| Products | Automobiles Agricultural machinery Engines |
The Chŏnsŏ Group, officially the Chŏnsŏ Automotive Corporation Holding Group, is a major Menghean partially state-owned Jachi-hoesa conglomerate which specializes in the production of motor vehicles. It is currently headquartered in the city of Chanam, though its main production center is in the city of Winam.
While most of Menghe's other large conglomerates, like Samsan, have diversified into other sectors like electronics and construction, Chŏnsŏ continues to specialize in motor vehicles and their components. It is best known for its civilian automobiles and light lorries, though it also produces agricultural equipment, motors, automobile parts, and light military vehicles. Historically, Chŏnsŏ specialized in low-end budget vehicles for the domestic market, but in the last decade it has attempted to break through into the middle range of the market, with mixed success.
History
Establisment
The Chŏnsŏ Group was first established as the Winam Chŏnsŏ State Automotive Factory in 1968. Its name came from its location: in the city of Winam, but west (sŏ) of the Wichŏn river running through the city. Similarly, its current logo is a stylized version of the Gomun character 川, or chŏn. In 1976 it was renamed to the Chŏnso Automotive Factory.
During the 1970s and 1980s, Chŏnsŏ was one of Menghe's largest automobile manufacturers, surpassing Donghae and Sŭngri by the number of vehicles sold. Many of its early products were copies of foreign vehicles, but it did design a number of light cars of its own. These affordable but ugly and unreliable cars became icons of civilian life in the Democratic People's Republic of Menghe, and in recent years they have regained attention as collector items.
Privatization
During Menghe's economic reforms in the 1990s, the Chŏnsŏ Automotive Factory was corporatized as the Chŏnsŏ Automotive Corporation, with its own budget and internal management rather than direct management by the Hadong Provincial Government. With the passage of the National Enterprise Law in 1998, Chŏnsŏ Automotive was reclassified as a Jachi-hoesa enterprise, meaning that its assets were formally state-owned but its managers could run it with limited state oversight.
Expansion and consolidation
After being corporatized as a semi-private entity, Chŏnsŏ set up new production lines in other cities and pursued a strategy of vertical integration, establishing fully-owned subsidiaries in the rubber, steel, and automotive parts sectors. To manage these various holdings, it established a parent company, the Chŏnsŏ Group.
During the 1990s and 2000s, Chŏnsŏ vehicles were popular among the lower end of Menghe's new middle class: families who could afford a car for the first time, but lacked the money for an expensive foreign brand. In particular, Chŏnsŏ benefited from Menghe's high luxury tax, which was applied to foreign luxury vehicles but not low-end domestic ones.
As a result of its rapid expansion and cost-cutting measures, Chŏnsŏ soon gained a mixed reputation. Many of its vehicles were unreliable or poorly built, and used low-quality steel and parts. Chŏnsŏ Automotive also made few efforts to improve fuel efficiency and emissions control, and for a number of years its vehicles ranked lowest in fuel efficiency among Menghe's major automakers. A string of accidents in the 2000s led to a formal government investigation of safety shortfalls and the recall of several of Chŏnsŏ's vehicle lines.
In 2011, on the tail end of a particularly large safety scandal, Chŏnsŏ was placed under new management, with CEO Man Yŏng-sŏk vowing to remake the company's image. Chŏnsŏ sold off a number of its poorly-performing divisions and cut ties with subsidiaries known for excessive corner-cutting, and launched a new effort to break through into medium-range markets.
Electric vehicles
Chŏnsŏ released its first electric vehicle in 2013. Since then, as part of Man Yŏng-sŏk's efforts to remake the company image, it has emerged as a major player in Menghe's electrive vehicle sector.