Domestic motor companies’ offshore production is the highest in history in the first quarter of this year.
According to the industry on April 8, Hyundai Motors and Kia Motors produced 1,093,881 cars in their overseas production facilities from January to March, setting a historic high, 6.1 percent up from last year’s 1,031,316 cars.
In their overseas facilities, Hyundai Motors produced 754,222 cars, while Kia Motors made 339,659 cars, posting 4.0 percent and 10.9 percent increase, respectively.
The rise is attributable to a boost in local production capabilities in response to the increased demand for cars in global markets, including China.
Hyundai Motors reinforced their production capabilities by 150,000 cars by expanding their three Chinese factories at the beginning of the year, while Kia has been newly operating their third Chinese factory since February.
Hyundai Turkey, which provides cars to the European market, also beefed up their production by 100,000 cars compared to September 2013.
Hyundai-Kia Motors, recording 4,110,000 cars in overseas production last year, is also expected to boost their overseas factory operations. The Korea Automobile Manufacturers Association predicts that the car giant’s overseas production will top 4,400,000 cars this year.
According to the association, domestic car production including exports in the first quarter posted a 3.7 percent increase year-on-year at 1,154,853 cars. A full 382,021 cars were for domestic use, while 788,957 cars were for export, recording a 6.5 percent and 1.1 percent rise, respectively.
Hyundai-Kia Motor’s domestic production also edged up 9.1 percent year-on-year to 924,549 cars. However, the figure reflects mitigating factors such as the company’s labor union refusing to work overtime during the first quarter of last year.
The industry foresees that domestic car production will see an increase of 1.7 percent to reach 4,600,000 cars this year, which is 7.1 percent lower than overseas production expectations.
According to some, this reflects the lukewarm attitudes of domestic automobile companies who are not too anxious to expand domestic production facilities due to labor-related issues such as the ordinary wage controversy.
In the meantime, last month’s car export recorded the second highest in history for monthly sales.
Korea Automobile Manufacturers Association accumulated the automobile industry’s statistics in March and reported that last month’s export was posted at 286,754 cars, 9.9 percent up year-on-year.
The export amount was posted at US$4.680 billion, the second highest figure after last December’s US$4.730 billion. It has been analyzed that the high performance stems from export cars’ price increases and increased sales of more, larger luxury cars and RVs.
The average export price of a domestic finished car rose from last year’s US$15,472 to US$16,307 this year. March domestic car demand increased 5.4 percent to 138,230 cars. The boost reflects the competitive introduction of new cars among domestic car companies as well as the sharp 30.4 percent rise in import car sales totaling 15,733 cars.