A big flat copper board enters the 1,200°C furnace. Some charcoal is put in as well. Charcoal is used to completely remove the oxygen because if the surface is rough or it blackens, it produces impurities and damages the finished product. Sam Dong succeeded in being the first in Korea to develop complete oxygen-free copper after hard work and efforts. The 99.99% pure oxygen-free copper then undergoes the process of rolling and coating to finally become copper coil.
Electricity generated in the power plant is delivered to use through copper coils. Dozens of copper coils are twisted into continuously transposed cable (CTC),which is an important material for extra-high voltage transformers. The life span and stability of transformers are determined by the performance of copper coil, and the entire device cannot be used if there is a defect on copper coil.
Therefore, while price is also important, the real competitive edge comes from quality and technology. Sam Dong has the world’s top leading-edge technology in the field of copper coils. The company’s copper coils are used in not only transformers but also generators in thermal and nuclear power plants, and its technological skills are considered as the best in the world. Hyosung as well as other world-renowned power systems companies use Sam Dong’s copper coils.
“The days of Hyosung in Changwon arrived as the Yeongdeungpo Plant was relocated to Changwon in the mid-1980s. Until then, Hyosung had been manufacturing their own copper coils for transformers. Since the risk was too high if copper coils have defects, Hyosung might not have been able to trust any other company.”
Hyosung improved the performance of transformers around that time. With the rapid growth of the Korean economy, the demand for power systems significantly increased, along with the demand for higher voltage. Striving to develop materials in in-house research centers by forming technology partnerships with the U.S. and Japan, Hyosung was faced with the choice between self-development and outsourcing, and finally chose to cooperate with Sam Dong for joint development. It was the time when specialization and segmentation were active. Until then there were no firms with CTC technology in Korea, so firms were fully depending on imports. At the time, Sam Dong had produced round and thick copper coils after its foundation in 1977, which it was supplying to SMEs in Japan and Korea. The round and thick copper coils are used in various products such as the cooler of a refrigerator, vacuum motor and automotive motor. Later, Sam Dong received financial support from the government and succeeded in joint development of CTC in the early 1990s.
The company established a plant to manufacture flat copper coils CTC in Eumseong, Chungbuk, after which it extended the Mungyeong Plant that manufactures round and thick copper coils. Currently Sam Dong operates three plants in the U.S. as well.
Sam Dong CEO Lee Ee Joo say that analyzing the data and designs owned by Hyosung’s research lab, which had a technological partnership with advanced countries, significantly helped the company develop CTC. With this as a momentum, Hyosung accelerated its overseas market expansion by manufacturing high-performance transformers, while Sam Dong could also open up a new overseas market. This makes the two companies long-lasting friends that have grown together.
Sam Dong is selected as an Excellent Partner for Hyosung Power & Industrial Systems PG in 2014. Total 10 companies were selected as Excellent Partners, which all contributed to securing Hyosung’s price and technological competitiveness among over 80 regularly evaluated partners supplying materials for extra-high voltage transformers, circuit breakers and motors of the Power & Industrial Systems PG.
“Though it means well, it is really difficult to actually practice coexistence in the business world, because it’s possible only when trust and justice are guaranteed. If one company seeks its own profits based on short-sighted attitude, it is definitely impossible to coexist. Manufacturing good materials for our partners to gain competitive edge for their products might be coexistence in a broad sense.”
<Sam Dong CEO Lee Ee Joo say that a true sense of coexistence is trust and justice.>
Pondering over ways to produce synergy effects is another way toward coexistence. If costs must be reduced, then the transportation costs, packing costs and energy costs will be reduced in the manufacturing process, but it is at least necessary to ensure the labor costs at least to the amount of inflation rate. Of course, this must be preceded by institutional considerations on cooperation.
Lee has the dream of developing Sam Dong into a specialized materials provider that is sustainable for over 100 years. To this end, it is necessary to develop a few more key items aside from CTC that will take the company to be the world’s number one. As Sam Dong has dived headfirst into the competition with the best quality in order to survive in the tough materials industry, the company will continue to make investments to increase its technological skills.