Daedong attracts investment from Kakao for smart mobility projects

Daedong Corp., South Korea’s leading tractor and farm machinery maker, has attracted 10 billion won ($7.6 million) from Kakao Mobility Corp. to accelerate its transition into a smart mobility company.

As a strategic investor, Kakao Mobility, Korea’s largest taxi-hailing app operator, will acquire a 4% stake in Daedong Mobility, an affiliate of the Daedong Group. Daedong Mobility will issue new shares to Kakao.

The two companies said on Wednesday they have also signed a deal to jointly develop next-generation smart mobility vehicles, including electric motorcycles, e-bikes, golf carts and other non-agricultural electric vehicles.

Daedong, dubbed the Korean Tesla of the agricultural machinery industry, has been striving to transform into a smart mobility company, applying autonomous driving and internet of things (IoT) technologies to its mechanized farming equipment.

Daedong Mobility is developing a battery-replaceable electric motorcycle based on the battery swap system (BSS) for last-mile delivery services. The company is also working on a half-ton electric truck and a small-size robot chair.

Recently, it unveiled a five-seater golf cart with IoT technology.

Daedong’s smart mobility factory, currently under construction at the Daegu National Industrial Complex, will be operational in the fourth quarter. It aims to produce a cumulative total of about 180,000 smart mobility products by 2026.

TRANSITION INTO A SMART MOBILITY FIRM

Daedong said its partnership with Kakao Mobility will advance its transition into a smart mobility provider.

Kakao Mobility, a unit of Korean tech giant Kakao Corp., is evolving into a mobility-as-a-service platform for its tens of millions of registered users.

In June, it forged a future mobility technology partnership with LG Electronics Inc. to jointly launch an autonomous delivery robot service.

“We’ll unveil innovative, market-leading products by combining Kakao Mobility’s platform operating capabilities with our machine manufacturing skills,” said Daedong Mobility Chief Executive Won Yu-hyeon.

In April, Daedong established a mobility research center with KAIST to develop motor and vehicle control technology. With Seoul National University, Daedong is developing autonomous driving and smart farm technologies. With KT Corp., it is working on an indoor autonomous driving technology based on a smart robot chair.

GAINING GROUND IN THE US

Founded in 1947, Daedong Corp. makes tractors, combines, power tillers and lawn mowers as well as engines, cylinder heads and blocks for agricultural machinery. In overseas markets, its products are sold under the KIOTI brand.

It is working to gain ground in North America, the world’s largest agricultural machinery market, dominated by bigger rivals such as Deere & Co., which makes farming machines under the brand of John Deere, and Japan's Kubota Tractor Corp.

In the first half of this year, Daedong posted 67.7 billion won in operating profit on sales of 814.2 billion won on a consolidated basis, up 35.1% and 28.2%, respectively, from a year earlier.

Write to Jin-Won Kim at Jin1@hankyung.com
In-Soo Nam edited this article.