Korea's manufacturing industry has suffered another setback. In automobile production, Korea slid to seventh place in the world last year as it became the only country among the world’s top 10 auto producers to record a drop in production volume for three years in a row.
Korea's domestic automobile production fell 2.1 percent year on year to 4,029,000 units last year, according to a report released by the Korea Automobile Manufacturers Association (KAMA) on Feb. 10.
In the same period, automobile production in Mexico inched up 1 percent to 4,110,000 units, pushing down Korea to seventh place. Korea dropped by one notch again after losing fifth place to India in 2016.
China kept its number one position for 10 straight years by producing 27.81 million units, although its production sank for the first time in 28 years.
Korea's automobile production stood at 4,556,000 units in 2015, but declined to 4,229,000 units in 2016, 4,115,000 units in 2017, and 4,029,000 units in 2018. Korea accounted for 4.1 percent of global automobile production, down 0.1 percentage point from 2017.
"A high-cost and low-efficiency production structure stemming from confrontational labor-management relations and a rigid labor market structure undermined Korea’s competitiveness in the automobile industry," a KAMA official said. “In addition, the closure of GM Korea’s plant in Gunsan, Korea in February last year and sluggish domestic sales and exports played a role in Korea's slip in the auto produciton rankings."