Seoul Man: A Memoir of Cars, Culture, Crisis, and Unexpected Hilarity Inside a Korean Corporate Titan (5 page)

Hyundai’s other takeaway from its analysis of the global auto industry’s future was the marketing miracle that was Audi. Until the 1990s, Audi was the poor-selling stodgy uncle of German cars—basically overpriced Volkswagens. Then Audi underwent a radical makeover, putting design at the forefront and giving itself a corporate identity: maker of gorgeous luxury cars. The designer behind the vanguard car of the sleek new look, the Audi TT sports coupe, was a hip, bespectacled German named Peter Schreyer who dressed only in all black.

So, in 2006, Hyundai went and got Schreyer.

Schreyer’s first job was head of design for Kia; in 2013 he was put in charge of Hyundai, too. Audi is now the world’s number two–selling luxury car badge. The thing is, until recently, Audis had not been particularly great cars, as judged by initial quality, reliability, and cost-to-maintain measurements, but they are beautiful and benefit from cachet-driven advertising and a premium image. This lesson was not lost on Hyundai. Good design doesn’t just sell cars; it establishes a brand presence and value and it is the way customers interact with your product. All you have to do is look at Apple to know how important design is.

Aiming upmarket was a big risk. It was one thing for Hyundai and Korea to match blows with Toyota and Japan. The auto industry could easily do the math and understand that if Hyundai kept building factories, it could sell as many cars as Toyota before long. But to aim for Audi, BMW, Mercedes-Benz? And to try to compete on something as tough to quantify as brand? That was a kind of chutzpah that maybe the rest of the world didn’t yet understand about Hyundai.

Hyundai set on course its grand ambition only three months after I started. Over the three years I was there, the company’s progress—and missteps—toward becoming a premium brand would be marked at every auto show, when Hyundai unveiled a new car that instantly exceeded or fell below the expectations it was setting for itself. It would be marked by every Car of the Year Award a Hyundai won—or didn’t win. It would be marked by every slide up or down the industry-wide quality ratings, every recall, every good or bad car review. This would be a long, uphill trudge, marked by signposts along the way. They would tell us if the idea was working—if customers were buying the idea that Hyundai could be more than what it was. It they didn’t, or if market conditions and other factors changed in the coming years
and it made sense for Hyundai to change tack and spin off a luxury sub-brand, the company was sensible and nimble enough to do it. But for now, this was the plan. Hyundai was all in. It’s hard to think of a major global company that had set itself higher stakes. This would have been like Walmart suddenly trying to convince its customers it was Neiman Marcus. Would anyone buy that?

This task is even tougher, and more costly, than it sounds. Going upscale would require more than marketing savvy and slick advertising. To succeed, to elevate its brand—and its prices—Hyundai needed to make significantly better cars. Better-looking, higher-performance, world-class quality. From its cheapest to its most expensive cars. What I didn’t know when I arrived at Hyundai was that they were already on the drawing board, being tested in wind tunnels and getting polished for their big motor show rollouts.

This would be the launch of Hyundai’s second act, and it was beginning just as I arrived. I suppose in one sense, Hyundai
was
getting a shiny new car for its midlife crisis.

KOREA’S BURDEN OF SUCCESS

At the same time that Hyundai was devising its next move, Korea began a serious midlife soul-searching about its future, questioning the very methods that had made it an economic success. In an amazingly short time—by will of a strongman leader and a military-like social structure that mobilized a pliant citizenry of “industrial warriors”— Korea had grown from one of the world’s poorest nations into one of the richest and smartest.

This rapid industrialization—maybe the fastest in world history—came at a high cost. It created a society where nearly everything is a competition. From fifteen-hour study days for chil
dren to fifteen-hour workdays for their fathers, Korea had turned itself into a Jacob’s ladder—a climb for something never achievable, on a ladder that just keeps repeating itself.

It’s why Korean parents pay tens of thousands of dollars for after-school private academies, or
hagwon
s, that go until ten p.m. so their children can ace the annual college entrance exam and get into a top Korean university. It’s why Koreans flock to plastic surgery—to make a better you. And it’s why Korea has one of the world’s highest rates of suicide. There is a spate of youth suicides after the annual college entrance exam, and more and more elderly Koreans are killing themselves either because they have been abandoned by their money- and status-obsessed children or they don’t want to be a burden on them.

Then there is the feeling among Koreans that for all of the country’s achievements, for all of their personal sacrifices, they are always in danger of slipping behind. Just when Korea seems on the brink of becoming what it sees as a first-rate nation, something like the
Sewol
ferry disaster of April 2014 happens and they feel they’re back to square one. Nearly three hundred people—most students—died when the ferry capsized. The
Sewol
was found to be carrying three times its allowable weight of freight and was top-heavy when it executed a hard turn to starboard. For Koreans—their own harshest critics—the deaths were the result of Korea’s
pali-pali
, or “quick-quick” culture: Do things fast instead of well, cut corners, maximize profits. It’s how Korea grew so quickly. It’s how ferry disasters happen. It’s how Hyundai grew so rapidly in the 1980s and it’s why the cars’ quality went downhill so fast in the 1990s. Hyundai had its come-to-Jesus moment in 1999 when it committed to quality improvement. Now it is Korea’s moment.

By 2010 this was beginning to happen. Loudly in the media, and in public protests, and in government, and even within the
chaebol
themselves, there was growing realization that the coun
try could not take the next step in its hoped-for growth by keeping up business as usual. The country could no longer rely solely on the
chaebol
. Koreans were beginning to realize that their economy must diversify from its manufacture-and-export model and develop the country’s practically nonexistent service sector and start-up incubators—to build a robust knowledge economy.

Korea’s other midlife crisis was more ghastly: when it looked in the mirror, it could see itself starting to resemble Japan. For a Korean of today, whose grandparents can tell stories of the brutal Japanese occupation of the Korean Peninsula in the first half of the last century, there is no worse fate.

Japan’s rise to postwar prosperity came on the backs of its family-owned conglomerates: the
zaibatsu
. Mitsubishi, Kawasaki, Nissan, and Panasonic became world leaders and household names. In the 1980s, media stories alarmed Americans that a rising Japan was buying up the scuffling U.S. economy in chunks of land and handfuls of skyscrapers. But by the beginning of the 1990s, the insulated business philosophy of Japan, corporate paralysis owing to an overimportance placed on consensus, the bursting of an asset bubble brought on by easy money, and the creeping ossification of the great companies helped bring on two decades of economic stagnation. Korea had a front-row seat for this and took copious notes.

Thanks to its increased standard of living after World War II, Japanese people also began living longer. By the 1990s, Japan’s societal graying was becoming a major problem. Korea, which began its economic growth about fifteen years after Japan, started seeing the same problem in the twenty-first century. Paying for their children’s
hagwon
s and universities; footing wedding bills that can easily top $200,000 (for middle-class families); buying keeping-up-with-the-Kims luxury goods; and forking over Manhattan-level housing expenses has left Korean parents with
little or no retirement savings and a total dependency on their children. Korean elderly, who should have been at the top of the Confucian hierarchy, were being abandoned by their children, who had grown up only in prosperity.

Hence, by 2013, half of Korea’s elderly were poor, the highest rate in the industrialized world. This may seem shocking and even unbelievable to foreigners who’ve never visited Korea and think of it as only an iridescent futurescape where everyone wears a Samsung wrist phone and has a wall-sized LG flat screen. It is that. But it is also the other thing. A heartbreakingly common sight is the hunched-over
halmoni
, or “grandmother,” pulling a cart of flattened cardboard boxes through the streets of Seoul, trading them for the pennies they bring.

There is a utility to ethnic and cultural unity when building your nation, especially under dictatorial rule: most people believe the same thing and they pull in the same direction. But mature democracies and economies are diverse: they draw insight and energy from immigrants, and they allow them to assimilate. Businesses are not vassals of the government and don’t always align themselves with the national interest.

But how would Korea get from here to there? It may have begun in 2012 when Park Geun-hye, daughter of the man who built modern Korea, ran for president. She talked about building a “creative economy” that would be diversified, encouraging entrepreneurialism, venture capital, and a real service sector. This was a radical departure from her father’s relentless message of “Build, build, build; produce, produce, produce . . . ,” but Korea was in a different place now and needed a different path to its future. Koreans believed and elected her. At the same time, the people of Seoul voted in as mayor a nonpolitician, a lifelong social activist who had been imprisoned for four months for protesting the iron rule of, ironically, Park Geun-hye’s strongman father. Instead of
preaching longer hours, harder work, higher targets, more diligence, Mayor Park Won-soon had radical ideas about creating a “sharing economy” and talked about quality of life, work-life balance, and institutionalizing siestas for his government workers.

At the same moment Korea was wrestling with this midlife crisis, jarring—and deadly—upheaval was coming on all sides of the peninsula’s geography, in Japan, China, and North Korea. This reinforced Korea’s self-image as a small country sandwiched between large, powerful, and aggressive ones, ones that often controlled Korea’s fate.

As if to illustrate this point, one month after we arrived in Seoul in 2010, North Korea attacked. The South Korean navy was holding live-fire exercises near a small South Korean island called Yeonpyeong, which sits just inside the South’s side of the two countries’ western maritime border. The North considered the exercises a military provocation and opened fire, shelling Yeonpyeong. The South retaliated, and although the exchange lasted only two hours, four South Koreans—two marines and two civilians—were killed. Yeonpyeong is only about seventy miles from Seoul; it was the closest Rebekah or I had ever been to military action. The day of the shelling, before we knew what was happening, I could see South Korean fighter jets scrambling over Hyundai headquarters. The sound is distinctive—closer to the ground and faster than a commercial jet—and it was a chilling reminder that Seoul is only thirty miles south of the border with North Korea, well within the range of that nation’s weaponry. The North’s attack was over before we heard about it in Seoul, but it became a bracing reminder that the country to the north was a hostile and unpredictable Stalinist police state with 1 million soldiers and a nuclear capability that was still technically at war with the country that was now our home.

ME: THE PLANETS ALIGN

When I started at the
Washington Post
in 1992, the paper had more than 800,000 daily readers. I watched that number fall below 800,000, then 700,000, then 600,000. At the same time, the
Post
and other big newspapers were building terrific online sites, but their ad revenue remained, at best, a fraction of newspaper ad revenue. In the early 2000s, the
Post
newsroom had its first-ever “voluntary early retirement,” or buyout. Then another. And another. A newsroom that had nearly 1,000 journalists at its peak in the early 1990s was closing in on half that by 2008.

I was a business reporter and part of my beat was covering the media industry and the Washington Post Company. I read the
Post
’s earnings reports. I watched ad revenue shrink and shrink some more. The cratering was general across the U.S. newspaper industry. This was bad news for my life plan. I had stumbled through a mechanical engineering degree at West Virginia University and, faced with the prospect of spending a career as a mediocre, unhappy engineer, looked for a way out. I found it when I wandered over to the student newspaper with an offer to take pictures, as I’d done for my high school yearbook. I realized instantly I loved the newsroom atmosphere, even if it was only a student newsroom in a ramshackle old white house in danger of coming down on itself at any moment. I stopped taking pictures and started writing. I loved the feeling of being in the know, and the agonizing thrill of writing. After that, all I ever wanted out of life was to be a journalist, and a journalist at the
Washington Post
, home of the industry’s best writers. But, after several years in my dream job, I had to admit that it looked like my beloved industry wasn’t coming back. I started looking for a Plan B and, squarely in middle age, it had better be sooner rather than later. I knew too many journalists in their fifties who were finding it difficult to make a professional life after the
Post
.

What I definitely was not looking for was a wife. I was neutral, at best, on marriage. I was already forty-four and never married. If a wife dropped out of the sky into my lap, I’d consider it. But I wasn’t looking.

Rebekah Davis fell out of the sky in early 2008 but missed my lap.