DHB

## Dokko, Hyoun, Bahk Corporation

박성호 Bahk Sung-ho

Dokko, Hyoun, Bahk Corporation (Anikatian: 독고현박법인, dokko hyeon bak beob-in), commonly shortened to DHB is an automobile manufacturing division of Anikatian industrial conglomerate Huadai Group, headquartered in Antiytia. In 2003, Mitaishi acquired a 10.8% stake in DHB during the economic restructuring crisis as the nation transitioned from the former Democratic Socialist Republic of Anikatia (DSRA) into its modern form, however it has since sold it's share of ownership in the company. It is among the leading Anikatian automotive firms and is well known for a range of premium hatchbacks, coupes, sedans, and particularly its off-road vehicles, having made their name in the production of the *Type 35* off-roader and the Special series of government limousines.

## History

On April 25, 1923, DHB was founded, as an independent company, in Antiyita, Anikatia, a small nation in East Asia with close historical links to China, and Korea. At that time, it was still under Japanese imperial rule and had been since it was fully annexed along with Korea in 1910. Much like another Anikatian automaker Maesima, the beginning of the Second Sino-Japanese War meant a takeover of factories for wartime production. However, the end of WW2 meant many of the former DHB factories were utterly destroyed by Allied bombing raids, while the remaining production facilities continued to be used for supporting wartime production for Japan during this time. After the Japanese retreat, Allied forces liberated Anikatia in late 1945, being met with little to no resistance. However, conflict soon arose in the remaining power vacuum between royalist rebels who supported Japanese rule, and socialist rebels who opposed and fought against Japanese rule as the Allied troops withdrew in 1948. A short but brutal civil war broke out and by 1950 communist forces had managed to win power of the island nation.

DHB had endured both global and domestic wars by getting along, making small quantities of cars that were often replicas of other existing models, along with the DHB *Six Three Six*. However, Anikatia itself was in a state of economic and infrastructural disrepair. The GDP per capita at this time was comparable with levels in the poorer countries of Africa and Asia. Run by a government inspired by the USSR saw various communist nations such as the USSR, North Korea and the People’s Republic proclaim support for the new regime and rushed to supply the new Socialist state. Due to the newfound access to resources, Anikatia embarked on a rapid path of development and industrialization, declaring itself to be the Democratic Socialist Republic of Anikatia. Soon enough it was considered as a model of Socialist ideals with impressively rapid industrialisation. All private enterprises were nationalised, including DHB, which had become a part of the AAU Group. Prioritizing the reestablishment of the automotive industry was key to this plan. The Socialist government implemented the “Automobile Industry Restoration Policy”, the objective of which was to prevent excessive competition between the major domestic automakers, and to accelerate progress by channelling larger sums of funds from the central government itself. Additionally, the government postponed and limited foreign imports in response to sanctions and blockages from other major world players. However domestic sales received the largest boost by the smaller government stimulus policies for lifting market demand under the larger overarching plan, including tax cuts on small-displacement automobiles, subsidies for trade-ins and subsidies for farmers to buy vehicles. DHB was one of the spearheading manufacturers that took the lead in the effort to revitalise the automotive sector.

Owing to the state of disrepair the nation’s roads were in following several wars, the only cars that were suitable for the conditions were light utility vehicles such as off-road vehicles and trucks. DHB would go on to create the nation's own military jeep, of which the civilian variant played a key role as the backbone for the minor agricultural revolution that resulted, aided by the adoption of mechanization and industrialization around the country. This was further boosted by government subsidies to farmers to buy vehicles. Perhaps most notable of all, they would play the role in creating prized luxury limousines for state officials. Models further down the lineup were simple sedans, arranged in the typical DHB style - rear-engined rear wheel drive - that were far too small to carry around the leaders, but were instead provided for higher officials and valued officers of the People's Army. Just like all the other Anikatian brands, DHB received technical assistance from the Soviet Union and was instructed to follow the Soviet model of rapid, large-scale industrialisation.

Furthermore, DHB and the government had crafted a plan to built up brand awareness and prestige by focusing efforts into motorsports and in the midst of the five-year plans of the socialist leaders, the small motorsport division within DHB managed to survive. Once word of the first International Dalnit-Bralka Rally of 1965 reached Anikatia, DHB quickly drew up plans to take the opportunity of participating. The rally was being held in Blomovakia, a nation that still held close ties with the DSRA. The leaders saw this rally as an opportunity to showcase to the world the rebirth of the Anikatian automotive industry, from war and destruction. DHB Motorsports were suddenly thrust into the spotlight and given merely a few weeks to prepare for the event. It must be noted that the DHB Motorsports division was seen as crucial, at least until Maesima took over the role of being the leading representative automaker after DHB lost face in the Dalnit-Bralka Rally. Given the requirements of the rally the DHB 330B sedan with a simple OHV 2.2L I4 being the only real option. A key figure, the principal racing driver for the new team was Kai Jung-ho, a test driver for DHB. He was joined by his co-driver Hyoun Jin-ho, chief political officer of the DHB Motorsports division and son of one of the founders of the company. Neither of them had participated in any professional racing or rally events. In fact, that would be the first time they had ever left their homeland of Anikatia. The popular good looks of the sedan combined with its story piqued the curiosity of the attending members and this attention may even have contributed to DHB’s successful entrance into world markets despite mediocre championship results.

As an international player, DHB’s relations mainly stemmed from government and foreign military demand for it’s *Type 35*, a very flexible, simple and utilitarian workhorse design. Limited exports to other private customers in third world nations provided some form of income. The establishment of a Socialist government had led to a great loss of foreign investment. Assistance was only partially available from Warsaw Pact members and Soviet allies, however, the merits of DHB’s own products were soon enough to secure them a place as sales picked up from countries like India and those in the Middle East. The Sino-Soviet split led to yet another difficult situation for the DSRA, and ultimately, they decided to align with China and open up to Western markets. During this time, the model range slowly grew in variety and DHB prospered.
Huge reforms were undertaken to liberalise and restructure the economy of the DSRA in 1979, by General Secretary Choi Kyu-sik, aiming to follow the Chinese model of market oriented reforms to the socialist system. This opened up the Anikatian market to foreign investment and allowed Anikatian brands to achieve a greater degree of exposure to the outside world. It quickly became obvious that indigenous designs were often not to the standards expected in Western markets, however the designs that DHB had been perfecting over the years were not too far off the mark. Being one of the top marques of Anikatia, they had managed to accumulate a significant enough cache of resources. Catalysed by government financial backing, DHB metamorphosed over the course of a decade’s time into a notable brand even in the eyes of the sophisticated audiences abroad, despite the arrival of Japanese imports in the markets of the USA. This growth could be attributed to the DSRA’s support for the automotive industry and their approving perspective that the sector was a key ingredient to the entire nation’s economic success, a stark contrast to the opposition within Japan from their own trade ministry. Meanwhile, sales of imports had increased significantly in the US since the oil crisis and facing little innovative pressure from American companies meant that DHB fared fairly well in the US market. At home, military development had been given priority from the beginnings of the DSRA and build up continued as Anikatia became a key supplier to it’s allies. This was another key, dependable source of income for DHB throughout it's life as they were a steady consumer of the infamous *Type 35*.

By the time the last of these company improvement efforts ceased, the USSR collapsed. The Berlin Wall fell as the Cold War drew to an end, with the Warsaw Pact dissolved. While still socialist in name, the DSRA government, realising the opportunity in their hands, pursued further market liberalisation, encouraging private ownership and more foreign investment along with the creation of stock markets. The creation of special economic zones, private banks and private saving based on the model of the Seulbyeni market resulted in record growth allowing it to become one of the leading exporter economies of the East, a very fortunate boost for DHB. The booming market sparked fears that a strong Anikuro would hurt exports for Anikatian companies on the world stage, however, the United States also experienced a timely economic boom during these years. This coincidentally well timed simultaneous growth resulted in strong sales for companies in the DSRA for a few years to come. On home ground, the DSRA government continued sustained aggressive military activities that kept the company busy.

In 1997, the Asian Financial Crisis hit, signalling the end of the “Far Eastern Economic Miracle”. While the DSRA initially managed to delay the onset, it was forced to devalue its currency in 1998 to preserve its competitiveness with the ASEAN nations, and also in response to uncontrolled money flow in and out of the country putting a drain on foreign reserves, giving way to inflation. The political leadership of the DSRA struggled to keep up with the pace of economic reforms and shifting landscape. A miscalculated and drastic move was made to curb prices but this cut the value of the Anikuro swiftly in half. A string of shock dismissals of high ranking bank government officials rocked the country but these measures were too late and failed to amount to anything beneficial, rather, starting a period of extreme speculation and uncertainty. Despite the hostile economic atmosphere, the government pushed companies to borrow money and aggressively expand. This was due to the fact that consumer spending was declining, and yet savings were contracting, so the country had to turn to other foreign countries to borrow money in order to reinvest it. In the wake of this, banks were left with non-performing loans as large public corporations failed to return profits in the face of falling consumer demand. Excessive debt from forced capital investment and military efforts led to major failures, and the government was forced to take emergency international loans from the IMF. Effectively, this massive debt meant the economy exhibited signs failure well before the currency itself collapsed.

Under huge pressure from the public through weeks of rioting and street violence, the reigning leader of the DSRA was forced to step down, taking the DSRA itself with him on the 21st of May, 2001. Major reforms were undertaken which saw the DSRA replaced with the Republic of Anikatia, which quickly accepted emergency international loans from the IMF. DHB was barely managing to survive, however this time, the surprise was that their saviour was not just the growing demand in the Asian markets for the *Type 35*, but surprisingly aided, and rather notably so this time, by the success of it's motorsports program outside boosting sales as executives had launched a program to expand into more segments of the car market with new models in the early 90s. Despite the company playing a diminishing role on the international stage for a few years to come, the image of it as a prestigious, noteworthy marque was cemented, playing a positive role on DHB’s subsequent re-entry into foreign markets. DHB was acquired during this time by the Huadai Group while Maesima had managed to sustain itself due to revenue from exports.

Over time the nation successfully moved towards a mixed market economy with the help of IMF loans. With increased foreign access, the company also was able to mount a path of success and recovery. Today, Anikatia has regrown into a stable economy and has integrated successfully into the world as a high-tech global power. It is considered to have experienced one of the most successful transitions from a socialist, centrally planned economy to a free market capitalist system. The continued support for the automotive industry promises to continue growth, supported by an ever-increasing diversity in the range of cars, varying in price and sophistication together with the growing electric car segment.