Expanding Markets
It turns out that American automobile companies such as General Motors (GM) and Ford are importing more and more Korea-made car parts.
According to a report published by the Korea Trade-Investment Promotion Agency (KOTRA) titled “American Automobile Part Industry Trend”, GM is to expand its imports of Korean car parts from approximately US$700 million per annum to US$1 billion by 2016.
With this plan in mind, the car giant is also reviewing the possibility of sending its headquarters’ global purchasing staff to GM Korea.
Ford, in the meanwhile, will augment its usage of Korean car parts by more than 20 percent for the next decade, while Chrysler has already boosted the number of Korean car part suppliers to 100 last year and is planning to add more affiliates in the offing.
The report stated that America’s big three automakers are actively expanding their purchase of Korean car parts in the wake of implementing the Korea-America Free Trade Agreement. They tend to import more environmentally-friendly car parts such as batteries, inverters, and other lightweight materials.
The report also pointed out that American automobile companies that sell final products emphasize quality and technology competitiveness rather than price, so the local industry needs to enhance their technology through R&D.