Stronghold Broken

German carmakers, including BMW, Mercedes-Benz and Audi, sold 10,533 vehicles in the domestic market in Jan., down 26 percent from the same month a year ago.
German carmakers, including BMW, Mercedes-Benz and Audi, sold 10,533 vehicles in the domestic market in Jan., down 26 percent from the same month a year ago.

 

The impenetrable stronghold of German carmakers is cracking now. As their brand images got tarnished due to incidents and scandals from the second half of last year, their market shares rapidly dropped in January.

According to the data from the Korea Automobile Importers and Distributors Association (KAIDA) on February 10, German carmakers, including BMW, Mercedes-Benz and Audi, sold 10,533 vehicles in the domestic market last month, down 26 percent from the same month a year ago. Accordingly, the market share of foreign cars stood at 64.9 percent, showing a 6.6 percent point decrease from 71.5 percent in the same period a year earlier.

The drop in the market share of German carmakers is not a temporary phenomenon. In October last year, the next month after Volkswagen's diesel emissions scandal occurred, the market share of German car brands rapidly fell by 10.1 percent point to 60.9 percent from 71 percent in the previous month. With large-scale sales promotions and clearance sale of the inventory in November, the figure restored to the former levels but it fell to 65.2 percent again in December, seeing the same trend until last month. Previously, German automakers had a 70 percent market share on average in the past two years.

In contrast, non-German auto brands are showing continuous growth. Only 8 out of 23 car brands registered in the KAIDA saw growth compared to January 2015, and 6 of them are non-German brands, including Ford, Land Rover, Lexus, Volvo, Infiniti and Cadillac. Considering the fact that the other Mini and Rolls-Royce were first launched in the U.K., though their sales data belong to BMW Group Korea, all car brands, which show an upturn last month, are non-German.

In addition, British Land Rover saw a 53.4 percent growth, while Sweden's Volvo and Japan’s Nissan showed a 42.5 percent and 30.1 percent increase, respectively, creating a new middle ranking group.

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