In 2009, the LPG market experienced a spurt of growth with the launching of compact cars and hybrid vehicles using LPG. However, LPG demand decreased during the first half of the year due to global financial instability and economic stagnation. In addition, the overall business environment was further aggravated by the increased competition from lowered restrictions on imports, introduction of more transparent LPG pricing, demand by taxi drivers’ associations and organizations for the physically challenged to lower LPG prices, and the Fair Trade Commission’s investigation on LPG price-fixing among oil companies and importers.
In response to all these occurrences, SK energy’s LPG Division enhanced its brand loyalty by introducing a differentiated customer care program to strengthen long-term competitiveness and secure a stable foundation for undertaking new business. In addition, SK energy has been progressively pursuing activities to increasinge N/W competitiveness and completed LPG market optimization at an early phase by transferring low-profit fueling stations to SK gas, an LPG specialist.
Through these activities, SK energy’s LPG Division achieved high operating profits despite a decrease in sales due to the optimization of the LPG market. In addition, it solidified a foundation to promote high-efficiency marketing strategies targeting at the SK energy supply chains.
In 2010, SK energy’s LPG Division secured competitiveness capable of responding to the rapidly changing business environmentes afflicting the LPG industry arising from increased competition among suppliers and distribution channels as a result of the government’s policy to encourage competition and from shrinkage of the markets resulting from the optimization of the LPG market. In addition, we will focus on strengthening our marketing competencies in order to achieve sustainable growth and enhanced profitability after further optimizing the LPG business structure.
Moreover, by handling changes in the market environment ahead of others, such as the government’s energy diversification plans, increased competitiveness of LPG pricing, expansion of alternative fuels as a part of eco-friendly energy resources and hybrid vehicle distribution, we will solidify our position as the most efficient company in the LPG market of Korea