Auto Shipments Plunge 36.3% on Year
South Korea’s automobile exports in April posted the sharpest drop since the financial crisis 11 years ago.
According to the Ministry of Trade, Industry and Energy (MOTIE) and the Korea Automobile Manufacturers Association, automobile exports stood at US$23.91 million in April, down 36.3 percent from the same month in 2019. It is the largest decline in 10 years and 10 months since June 2009 (-38.1 percent).
Car exports to the United States from April 1 to 25 totaled US$860 million, a 16.7 percent drop from a year ago. Shipments to Europe slid 21.4 percent to US$460 million. Exports to the CIS totaled US$100 million, down 58.6 percent due to a drop in the value of the Russian ruble and a decrease in new car purchases.
Industry watchers say that Korean carmakers will face more trouble in exporting their cars in May due to the relentless spread of the novel coronavirus. Economic growth in the United States in the first quarter of the year hit -4.8 percent, the lowest since 2008. Many economists predict that the growth rate will be even worse in the second quarter. The sharpest decline in automobile exports thus far was the 54.8 percent drop recorded in January 2009 in the thick of the global financial crisis. Some analysts say that the record may be broken in May.
In April, Korean auto parts producers suffered a harsher damage than car manufacturers. Auto parts exports fell 49.6 percent to US$1.22 billion in April, which shipments to the U.S. and Europe plunging 59.2 percent and 53.5 percent, respectively, to US$190 million and US$160 million. The figures for other parts of the world were US$90 million for Latin America (-59.1 percent), US$40 million for India (-50.2 percent), and US$50 million for the Middle East (-33.2 percent). Korean auto parts exports plunged as the Chinese auto market slumped and car plants in Europe shut down due to the COVID-19 outbreak.
Meanwhile, automobile imports increased by 12.1 percent to US$945 million in April. Experts say that overseas companies turned to Korea, which was less affected by the pandemic than other countries. In particular, imports from Europe including Germany jumped 60.0 percent from the same month of 2019. But U.S. car imports fell 22.6 percent.