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South Korea's Automobile Production Drops 0.6% in Q1
Gap with Mexico Widens
South Korea's Automobile Production Drops 0.6% in Q1
  • By Michael Herh
  • May 20, 2019, 10:52
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Korea’s automobile production fell 0.6 percent on year in the first quarter.

Korea’s automobile production stood at 957,402 units in the first quarter of this year, down 0.6 percent from 962,803 units in the same period of last year, said the Korea Automobile Manufacturers' Association (KAMA) on May 19.

Korean carmakers’ domestic sales and exports edged up 0.6 percent and 1.4 percent, respectively, in the first quarter of this year. However, automobile production shrank due to production disruptions and inventory adjustments at some automakers. The labor union of Renault Samsung Motors went on 62 partial strikes for about 10 months during the wage and collective bargaining process in 2018.


As a consequence, Korea continued to stay at seventh place among the global auto producing countries in the first quarter of this year as in 2018 but its production gap with Mexico, the sixth-place car producer, widened. The production gap between Korea and Mexico was 44,800 units in the first quarter of last year but it grew to 72,200 units this year.

Korea had ranked fifth in the world until the end of 2015, but was overtaken by India in 2016 and by Mexico in 2018.

However, industry experts forecast that domestic automobile production will recover in the second quarter thanks to the normalization of production facilities and the effects of new models. The labor dispute at Renault Samsung Motors which has lasted since last year is expected to be settled on May 21 at the earliest. The export volume is also on the rise. The Ministry of Trade, Industry and Energy said that Korea's exports increased 3.0 percent while production rose 5.0 percent on year in April.

In the meantime, in the first quarter, automobile production by the world’s top 10 automobile powerhouses -- China, the United States, Japan, Germany, India, Mexico, Korea, Brazil, Spain and France -- saw their output fall by 4.6 percent year-on-year to 18,491,000 units.

While China and the United States posted drops in car production volume, Japan, Mexico and France recorded an increase. Especially, Japan and Mexico expanded their car production thanks to an increase in their car export volume despite decreases in domestic consumption.