Hankook Tire faces leadership vacuum after chairman's arrest

• Published date: 09 March 2023
• Publication title: The Korea Times

Hankook Tire and Technology, a local tire manufacturer, is expected to see a slump in exports of its key products and delays in overseas investments after its CEO Cho Hyun-bum was arrested on charges of embezzlement and breach of trust for a combined amount of 20 billion won ($15 million), according to market watchers.

Thursday's arrest came less than three years after he stepped down as CEO in June 2020 over previous bribery and embezzlement charges. The resignation was prompted by a prison term suspended for four years following his arrest in November of 2019 and subsequent guilty verdict. Cho will serve a prison term if he is found guilty on the latest charges, since he was released on a suspended sentence in 2020.

Whether and how likely the leadership vacuum would drain the business of local manufacturers remains to be seen. Over 90 percent of its sales come from exports. The firm planned to invest 1 trillion won to expand and modernize its manufacturing facilities in the U.S. state of Tennessee, in a move to register a year-on-year increase of 5 percent in sales, underpinned by the stable supply of tires for electric vehicles (EVs) and 18-inch products.

The prosecution launched an investigation into Cho, initiated by a Fair Trade Commission...