Samsung announced plans to boost investments in businesses expected to drive its future growth, according Telecompaer. The company will spend KRW 25 trillion (EUR 19.2 billion) over the next three years, primarily led by Samsung Electronics, in the areas of artificial intelligence, 5G, automotive electronics components and biopharmaceuticals. In addition, the company will expand its venture capital investments to identify promising new businesses and technology.
Overall, Samsung plans to invest a total of KRW 180 trillion over the next three years, including the spending on future growth businesses. The amount includes capital expenditures and R&D investments, and KRW 130 trillion of the total will be spent in Korea. The new investment plan follows the overhaul of the group's management at the end of 2017 and comes in the face of slowing sales at its biggest earner in recent years, smartphones.
In semiconductors, Samsung will expand investments in manufacturing hubs, including in Pyeongtaek, to maintain its technology edge and meet expected significant new demand from applications in AI, 5G, data centres and automotive electronics. In addition to investments for memory products, spending will go to non-memory and new advanced manufacturing equipment. For displays, investments will be increased to develop "high-value, differentiated products amid rising competition in the industry".
Extra AI
In AI, Samsung plans to significantly expand its research capability, increasing the number of advanced AI researchers to 1,000 across its global AI Centers. It will also invest "aggressively" to become a global player in the advanced markets for 5G chipsets and related devices and equipment.
In addition, Samsung said it aims to become a leader in electronics components for future cars such as system-on-chips for autonomous driving, building on its activities in semiconductors, telecommunications and display technologies. For biopharmaceuticals, Samsung has seen strong growth from both its contract manufacturing and biosimilar businesses. It will continue to invest heavily in the businesses, including developing and manufacturing biosimilars to combat chronic and difficult-to-cure diseases, the company said.
More jobs, start-ups, suppliers
Samsung expects the additional investment to create 20,000 new jobs in the next three years, on top of expected hiring of 20,000 in its normal course of business over the same period. Samsung will also set up and operate with the Korean government software education centres across the country, which will nurture software talent and help create new job opportunities. The centres will train 10,000 students and job candidates, and provide employment consulting services for the next five years.
To support start-ups, Samsung will expand its internal venture incubation program, C-Lab, which was introduced in 2012, to support external start-up projects. The platform will benefit 500 projects – 300 external candidates and 200 inside the company – in the next five years to encourage innovations and entrepreneurship.
More support for suppliers is also planned, with a total KRW 4 trillion available for extending financing to more sub-contractors in the lower-level supply chain and increasing incentive payments. Samsung will also increase the scale of its Smart Factory program, which provides automation assistance for small and medium enterprises’ manufacturing facilities.
