Domestic sales by South Korea’s five main automakers combined increased by just 1.4% to 106,856 units in August 2023 from 105,413 a year earlier, according to preliminary wholesale data released individually by the manufacturers. The data did not include sales by low volume commercial vehicle manufacturers or imported vehicles, which are covered by a separate report.
The domestic vehicle market has become more sluggish in recent months as consumers and local businesses increasingly feel the effects of higher borrowing costs following last year’s sharp interest rate hikes from 1.25% to 3.5%. The strong market growth seen in the first half of 2023 was mainly driven by an easing of last year’s supply chain bottlenecks, which has allowed automakers to fulfil order backlogs this year, and also significant new model activity particularly by the leading domestic automakers.
In the first eight month of the year, domestic vehicle sales were still up by almost 10% at 983,579 units from 896,777 units in the same period of 2022. The market was lifted mainly by Hyundai Motor which reported a 16% sales rise to 509,608 units, and by Kia Corporation with an 8% increase to 385,155 units. GM Korea sales were up by 6% to 26,424, helped by the introduction of the new Trax crossover model at its Changwon plant in February, while KG Mobility enjoyed a 14% rise to 46,915 units as confidence in the brand returned following last year’s takeover by the local KG Group.
Renault Korea, which is struggling to keep pace with rising competition in this market, reported a 55% plunge in local deliveries to 15,477 units year to date.
Global sales among the country’s big five automakers, including vehicles produced overseas by Hyundai and Kia, increased 5.5% to 653,811 units in August from 619,945 units a year earlier, while cumulative eight month sales were 10% higher at 5,309,213 from 4,808,698 units, helped by improved supplies of semiconductors following last year’s shortages. Overseas sales increased 6% to 546,955 units last month from 514,528 units, while YTD volume was 10% higher at 4,325,634 units from 3,911,921.
Hyundai Motor global sales increased 3% to 347,377 units in August from 336,609 a year earlier, driven by strong domestic sales while overseas sales were only slightly higher. Total YTD sales were up 9% at 2,765,554 units from 2,546,496.
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Domestic sales rose 13% to 55,555 units last month from 49,224 units a year earlier, resulting in a 16% rise in YTD sales to 509,608 from 439,925, reflecting strong demand for the redesigned Grandeur sedan and the company’s strong SUV range. Hyundai launched the redesigned Kona compact SUV range earlier this year, including an electric variant, and the redesigned Santa Fe mid size SUV last month.
Overseas sales increased 1.5% to 291,822 units in August from 287,385 units while YTD volume was up 7% at 2,255,946 from 2,106,571 reflecting strong demand for its SUVs in key regional markets including North America, Europe and India.
Earlier this year Hyundai said it aims to increase global sales by 10% to 4.32m units in 2023, helped by “optimised business strategies tailored for each region”. This includes 3.54m overseas sales and 781,000 in its home market. The company last month said it plans to improve its product mix by increasing production of higher margin models including SUVs and EVs. It is scheduled to launch the N brand’s first EV model, the Ioniq 5 N, in the domestic market later this year and in global markets next year.
Kia global sales increased 5% to 255,481 vehicles in August from 242,861 a year earlier, reflecting higher domestic and overseas sales. Total YTD sales were up by almost 9% at 2,092,200 units from 1,922,080 units, driven by strong demand for SUVs including the new Sportage and K3 sedan.
Domestic sales increased 2% to 42,599 units last month from 41,726 a year earlier, with the Sorento SUV and the new Carnival MPV the brand’s best- elling models. YTD sales increased by 8% to 385,155 units from 356,242 previously.
Overseas sales rose 6% to 212,882 units in August from 201,135 units and by 9% to 1,707,045 units YTD from 1,565,838 units, reflecting robust demand for SUV models such as the Sportage and Seltos in key regional markets including North America, Europe and India.
Kia said it aims to increase its global sales over 10% to 3.2m units in 2023, including 585,120 domestic sales and 2.61m overseas. The automaker continues to expand its EV range in global markets, with the new EV9 SUV scheduled to be launched in North America and Europe in the fourth quarter of 2023 followed by the EV5 compact electric SUV and the EV6 electric sedan next year.
Kia’s medium term target is to sell 4.3m vehicles annually by 2030, of which 1.6m are expected to be battery electric vehicles (BEVs).
GM Korea global sales jumped 74% to 31,716 vehicles in August from 18,208 a year earlier, reflecting strong export sales following the introduction of the new Trax crossover vehicle at its Changwon plant in February. YTD sales were up 72% at 286,727 units from 166,745.
Local sales fell 8% to 3,297 units last month from 3,590 a year earlier but were up 6% at 26,424 YTD from 24,973 underpinned by the new Trax and Bolt EV models. Other GM models sold locally include the Colorado and Sierra Denali pickup trucks and the Equinox, Traverse and Tahoe SUVs, with the Cadillac Lyric scheduled to be launched later this year.
Exports surged 94% to 28,419 units in August from 14,614 a year earlier and by 84% to 260,303 YTD from 141,772.
KG Mobility global sales increased just slightly to 10,823 vehicles in August from 10,645 a year earlier, with strong exports offsetting a sharp decline in domestic sales. The company was acquired last year by a consortium led by local steel and chemicals firm KG Group. Total sales YTD were up 26% at 86,636 units from 68,926.
Domestic sales plunged by 44% to 3,903 units last month from 6,923 units a year earlier, but were still up by 14% at 46,915 units YTD from 41,200 units. The company said it would launch its new Torres EVX SUV, powered by a lithium iron phosphate battery pack, this month.
KG Mobility recently displayed three other battery powered vehicles: the O100 pickup truck built on a dedicated EV platform, the F100 based on the Rexton SUV and the subcompact KR10 SUV.
Exports jumped by 86% to 6,920 units last month from 3,722 units, helped by the recent launch of the Torres SUV in Europe, and by 43% to 39,721 units YTD from 27,726.
KG Mobility is in the process of finalising the acquisition of bankrupt Edison Motors Company, a local electric commercial vehicle manufacturer that just two years earlier had successfully bid to acquire KG Mobility (then known as Ssangyong Motors) from bankruptcy but failed to complete the acquisition.
Renault Korea global sales plunged 28% to 8,414 vehicles in August from 11,622 units a year earlier, with local sales and exports both declining sharply. Total sales YTD were down by 25% at 78,096 units from 104,451 units.
Local sales fell by 62% to 1,502 units last month from 3,950 earlier, as the company struggled with rising competition from domestic manufacturers and from other imported brands, while YTD sales were down by 55% at 15,477 from 34,437 units.
Exports were down 10% at 6,912 units in August from 7,672 a year earlier and by 11% at 62,619 YTD from 70,014 units.
Last month Renault Korea said it was stepping up its plans to introduce more hybrid vehicles in this market to help revive the brand’s sales, with a version of the XM3 compact SUV the only hybrid model currently being sold in the country. The company had previously announced it was making preparations to begin production of a Geely based hybrid model at its Busan plant. In a more recent statement, the company’s CEO revealed plans to add a mid-sized hybrid SUV model to its lineup in the second half of next year under its Aurora 1 programme.
Renault Korea wants to produce EVs in South Korea later and has been discussing sourcing batteries from local producers including LG Energy Solution, SK On and Samsung SDI.
South Korean automakers: domestic/overseas sales by brand, August 2023