Korean car buyers have discovered an extraordinary loophole whereby they can purchase cars from domestic manufacturers cheaper……. from abroad.
They can buy US-built Hyundai and Kia models at cheaper prices even though they have to pay import duties.
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The Korean Times said this stems local automakers’ “misguided” price policy in which they sell cars cheaper abroad than at home.
The newspaper said: “It is somewhat understandable that car manufacturers have long exported cars at discounted prices to maintain their competitive edge against global giants.
“However, it is no exaggeration to say that local motorists have paid virtual subsidies to Hyundai Motor, Kia Motors and other carmakers to help them export more. But now, the time has come to terminate the dual price system that discriminates against Korean consumers. Actually, the nation’s two leading carmakers ? Hyundai and its affiliate Kia ? are expected to continue their record-breaking earnings spree this year, boosted by their brisk sales at home and abroad.”
The Korea Times called the carmakers “arrogant” as their global sales strengthen further, adding: “They are not willing to listen carefully to public concerns that they have taken domestic consumers hostage for maximising their profit. In fact, Hyundai and Kia have long dominated the Korean car market, making little room for consumer choice.”
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By GlobalDataThe newspaper also alleged that local consumers have also been complaining about the quality of cars. “It has been no secret that the automakers export better quality cars equipped with up-to-date airbags and other safety gadgets. They usually install six airbags in each car to be exported to the US while most cars for domestic use have only two airbags.
“The story does not stop here. The Korean firms provide a much longer period of warranty services for overseas buyers than domestic ones. No one can deny that the auto companies have tenaciously stuck to the outdated policy of export promotion that was prevalent in the 1970s and 80s even at the cost of local consumers’ interests.
“It goes without saying that Hyundai and Kia cannot become the word top-class automaker by keeping the anachronistic strategy.”
The newspaper called on the two carmakers to “shift their focus from export first to consumer first. They also need to share their profits with domestic consumers ? the driving force behind what Hyundai and Kia are today ? by supplying cheaper cars with better quality.”
