The Russian market, now stronly contested by a variety of foreign car makers with both imported and locally-assembled models, is emerging as one of the main export targets of South Korean automakers as North American sales stagnate.
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Shipments of Korean vehicles into Russia are growing at about 100% annually and the country imported 78,523 Korean cars in 2005, up from 43,452 in 2004 and 21,226 in 2003, the Korea Times reported.
Imports reached 56,022 units during the first five months of this year, suggesting another 100% increase in 2006. The rise in exports to Russia is making up for stagnant exports to the United States and Canada.
Russia was the second-largest importer of Korean vehicles in the five-month January-May period, following the US, which took 309,595 units. Spain ranked third with 52,870 units, trailed by Canada with 50,094 and Italy with 47,951 units.
The report said more than one in five car customers in Russia are buying models produced by Hyundai Motor or affiliate Kia Motors – Kia has a CKD assembly plant there building popular models such as the Spectra.
Hyundai’s market share in Russia hovers between 16 and 20%, Toyota has 12-13%, Uzbek-Daewoo 10%, Mitsubishi 9.5% and Ford 9%. With Kia ranked at eighth with about 4%, the combined market share of Hyundai and Kia comes to 20-24%.
Hyundai Motor began taking the top place in the Russian market in May 2004, outperforming global competitors such as Toyota, Ford and BMW.
The automaker was 10th in 2002 and fourth in 2003, and overtook Toyota/Lexus in 2004 maintaining its top place last year.
“The performance is attributable to the transfer of our regional headquarters in eastern Europe to Moscow last year,” a Hyundai official told the Korea Times. Considering the growth potential of Russia, the automaker plans to supply cars suitable for the country’s climate and geographical features, he added.
Kia Motors is also mapping out strategies to beat international competitors in consultation with parent Hyundai Automotive Group, the report said.
