Semiconductors Aplenty
In the first quarter of 2023, domestic automobile production exceeded 1 million units for the first time in six years in Korea. This is because a shortage of automotive semiconductors that had continued until last year was largely resolved.
According to the Korea Automobile Manufacturers Association on April 10, domestic finished car production in Korea increased by 27.2 percent year on year to 1,065,249 units the first quarter of this year. It was the first time in six years since the first quarter of 2017 (1,040,971 units) that automobile production in the first quarter exceeded one million units.
Passenger car production in the first quarter was 980,730 units, up 20.7 percent from the same period of last year, and commercial vehicle production grew by 28.5 percent to 83,519 units.
Domestic sales and exports also expanded. The Korean car industry sold 429,474 units in the domestic market in the first quarter of this year, up 15.2 percent from the same period last year. Domestic cars sold 366,501 units, up 18.9 percent from the previous year, while imported cars only sold 62,973 units, down 2.7 percent. Korea’s car exports were 684,009 units, up 30.8 percent from the same period of last year.
By company, Hyundai Motor’s and Kia’s first quarter production stood at 482,322 units and 420,640 units, up 28.1 percent and 25.4 percent year on year, respectively. During the same period, GM Korea produced 86,225 units, up 42.7 percent, and KG Mobility (formerly known as SsangYong Motors) produced 35,790 units, up 52.6 percent. On the other hand, Renault Korea’s first quarter production contracted by 5 percent to 375,065 units.
Industry insiders analyze that an improvement in automotive semiconductor supply resulted in the increase in domestic car production in the first quarter. In fact, Hyundai Motor’s global sales volume continued to increase every month with 306,296 units in January, 327,718 units in February, and 381,885 units in March. The Korean carmaker has set its sales target for this year at 4.32 million units, up 9.6 percent from 2022.