SEOUL, Oct. 9 (Yonhap) — South Korean conglomerates such as Samsung Electronics Co., LG Electronics Inc., Hyundai Motor Co., and Kia Corp. are keeping a close eye on the potential business repercussions of the escalating conflict between Israel and Palestinian Islamist group Hamas, industry sources reported Monday.
Samsung Electronics has implemented a remote work scheme for their employees in the country and is regularly monitoring the safety of their workers. Chairman Lee Jae-yong visited the company’s research and development (R&D) center in Israel late last month to be briefed on their investments in cutting-edge technology research.
LG Electronics, which runs a local sales branch in Tel Aviv, has decided to bring its employees and their families back home due to safety concerns. In addition, the company acquired a controlling stake in Israeli automotive cybersecurity firm Cybellum in 2021.
Hyundai Motor and Kia Corp., which are the leading automakers in Israel, are also “closely monitoring the local situation,” according to company representatives. Industry watchers are concerned that an extended conflict could negatively affect the automakers’ sales.
Korean Air Co. has canceled its flights from Incheon to Tel Aviv this week due to safety concerns, though it has kept in place the returning flights from Tel Aviv to Incheon. The company said it will assess the airport situation in Tel Aviv before deciding whether to operate the return flights.
Oil refiners are also keeping a close watch on the Middle Eastern situation. If the conflict ends up increasing international oil prices, the refining industry could potentially see a short-term increase in earnings. However, if the situation continues, it could slow down demand and have a negative impact on net earnings.
South Korean builders with projects in nearby countries in the Middle East are also on high alert. A construction industry representative said the industry as a whole is “observing the situation for now.”