Auto Industry
Korean automobile exports bounced back for the first time in 13 months largely due to the increase in sales of full-size and multi-purpose vehicles. However, the domestic demand continued a decreasing trend with sluggish sales of imported cars. The market share of imported vehicles dropped to some 13 percent for the first time in 2 years.
According to “November Auto Industry Trend” released by the Ministry of Trade, Industry and Energy on December 8, the country’s car production and exports increased 5.1 percent and 0.9 percent, respectively, in November compared to the same period last year, while its domestic demand decreased 0.2 percent. The exports turned around in 17 months after June 2015.
First, auto production recorded 415,106 units, up 5.1 percent from the same period a year earlier thanks to efforts to recover the delay in production after the wage settlement.
Domestic sales of cars, produced by local companies, grew 2.8 per cent to 143,329 unit, propelled by growing sales due to the release of new car models despite the end of benefits for the individual consumption tax cuts.
On the other hand, imported car sales stood at 21,913 units on shortage of supply by some automakers, down 16 percent from the same month a year ago and 7.2 percent from the previous month. Accordingly, overall domestic sales edged down 0.2 percent on-year to 165,252 units. The market share of imported cars rose from 14.1 percent in November 2014 to 15.8 percent in November 2015, but the figure dropped to 13.3 percent in November this year.
With the expansion of supplies from the pay settlement and growing exports of full-size and multi-purpose vehicles, exports rebounded in 14 months after 3.5 percent in October 2015 in terms of the number of cars and in 17 months after 6 percent in June 2015 in terms of the amount of exports.
The number of car exports increased 0.9 percent to 260,491 units from the same period last year, while the amount of car exports added 1.5 percent to US$3.98 billion (4.62 trillion won).
By county, exports to North America, Middle East went down by 0.6 percent and 7.9 percent to US$1.7 billion (1.97 trillion won) and US$635 million (737.87 billion won), respectively. The figure to Latin America and Asia also dropped by 6.8 percent and 28.8 percent to US$321 million (373 billion won) and US$273 million (317.23 billion won). In contrast, exports to the European Union, Oceania and Africa went up by 34.6 percent, 14.9 percent and 33 percent to US$572 million (664.66 billion won), US$201 million (233.56 billion won) and US$107 million (124.33 billion won), respectively.
Domestic firms’ production at overseas plants continuously grew and sales of overseas plants increased 10 percent to 463.036 units. For sales of overseas production in November, Hyundai Motor saw a 5 percent increase to 307,840 units, while Kia Motors showed a 21.5 percent growth to 155,196 units.
Exports of car components also rose 4.2 percent to US$2.12 billion (2.46 trillion won) compared to the same month a year ago largely due to the increase in production at overseas plants and the base effect from the previous year.