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September 2, 2020

South Korea sales fall in August

Domestic sales by South Korea's five main automakers combined increased 5.6% to 111,847 units in August 2020 from 118,479 units in the same month of 2019, according to preliminary data released individually by the companies.

By bcusack

Domestic sales by South Korea’s five main automakers combined increased 5.6% to 111,847 units in August 2020 from 118,479 units in the same month of 2019, according to preliminary data released individually by the companies.

The data did not include sales by low volume commercial vehicle manufacturers, including Tata-Daewoo and Daewoo Bus Corporation, as well as sales of imported vehicles which will be covered in a separate report when the data is released later in the month. Together these accounted for 14% of total vehicle sales in the country last year.

August saw the domestic market’s first decline in four months, after sales rebounded strongly from the sharp first quarter decline, helped by a 30% cut in the passenger vehicle sales tax rate to 3.5% and new model launches by the leading brands. Vehicle manufacturers in the first quarter were forced to shut down operations due to supply chain disruptions and government measures to limit the spread of the COVID-19 pandemic.

Hyundai was the only manufacturer to report a domestic sales increase last month, of just over 3% to 54,590 units, while Kia’s sales were down by 11% at 38,463 and GM Korea’s fell 8% to 5,898. Sharper declines were reported by Renault-Samsung and Ssangyong, of 21% to 6,104 units and 15% to 6,792 respectively.

In the first eight months of 2020, domestic sales by the big five automakers were 5.1% higher at 1,056,357 units from 1,004,651 in the same period of last year. 

Global sales by the big five, including vehicles produced overseas by Hyundai and Kia, continued to fall in August, by 10.5% to 573,279 units from 640,850 units a year earlier, reflecting declining domestic and overseas sales. Global sales in the first eight months of the year were down by just over 18% at 4,219,034 units from 5,150,052 in the same period of last year.

Overseas sales, including exports and vehicles produced overseas by Hyundai and Kia, fell by close to 12% to 461,432 units last month from 522,371 units a year earlier, with many overseas markets still struggling to recover from the global pandemic. Overseas sales in the first eight months of the year were down by close to 24% at 3,162,677 units from 4,145,401 in the same period of last year.

Hyundai Motor‘s global sales fell by 14.2% to 312,990 vehicles in August from 364,590 a year earlier, reflecting sharply lower overseas sales, resulting in a more than 21% drop in cumulative eight-month sales to 2,237,733 units from 2,848,759 previously.

Hyundai’s domestic sales rose by 3.2% to 54,590 units last month from 52,897 a year earlier, reflecting strong demand for popular models such as the Grandeur and Sonata sedans and upmarket Genesis models. The company also launched the redesigned Avante compact car in June. Domestic sales in the first eight months of the year were almost 3.9% higher at 516,584 units from 497,296 previously.

Overseas sales fell by over 17% to 258,400 units in August from 311,693 a year earlier. In the first eight months of the year Hyundai’s overseas sales were down by almost 27% at 1,721,149 units from 2,351,463 units previously.

Kia Motors‘ global sales fell by 5.2% to 216,945 units in August from 228,741 a year earlier, reflecting weaker domestic and overseas sales. Global sales were down by over 11% at 1,603,791 units in the first eight months of the year from 1,807,970 previously.

Domestic sales declined by over 11% to 38,463 units last month from 43,362 units a year earlier, while the cumulative eight month total was still 9.1% higher at 363,800 from 333,312 – driven by strong demand for SUV models such as the Sorento, Sportage and the recently revised Seltos.

Overseas sales fell by 3.7% to 178,482 units in August from 185,379 a year earlier, with new models helping to offset weak demand in key export markets. Overseas sales in the first eight months of the year were down by almost 15% at 1,416,263 from 1,660,037 previously.

GM Korea‘s global sales rose by over 13% to 27,747 units in August from 24,517 in the same month of last year, reflecting sharply higher overseas sales. Global sales year to date were close to 21% lower at 228,417 units from 287,540 in the same period of last year.

Domestic sales fell by 8% to 5,898 units last month from 6,411 units a year earlier, despite the recent launch of the locally assembled Trailblazer SUV.

Local sales in the first eight months of the year were still almost 11% higher at 53,978 units from 48,763 previously.

In June General Motors reconfirmed its commitment to South Korea, saying it would make increasing use of generous zero emission vehicle sales incentives, starting with the launch of the redesigned Bolt electric vehicle.

Exports increased by close to 21% to 21,849 units in August from 18,106 a year earlier, but were down by almost 27% at 174,439 units in the first eight months of the year from 238,777 units previously.

Renault-Samsung saw its global sales fall by close to 42% to 7,570 vehicles in August from 12,987 in the same month of last year, reflecting sharp declines in both domestic sales and exports. Total volume in the first eight months of the year fell by close to 27% to 84,158 units from 114,705 previously.

Domestic sales fell by over 21% to 6,104 units last month from 7,771 a year earlier despite the recent launch of the revised SM6 sedan and the new XM3 SUV. Local sales were still up by almost 29% at 67,647 units year to date from 52,585 previously. 

Exports plunged by almost 72% to 1,466 units in August from 5,216 a year earlier, reflecting mainly the end of exports of the Rogue SUV. Export volume in the first eight months of the year were down by close to 74% at 16,314 units from 61,583.

Ssangyong Motor reported an almost 20% drop in global sales to 8,027 units in August from 10,015 a year earlier, reflecting sharp declines in both domestic and export sales. Overall sales in the first eight months of the year were down by almost 27% at 64,873 units from 88,702 in the same period of last year. 

Domestic sales fell by 15.5% to 6,792 units last month from 8,038 a year earlier, resulting in a more than 25% drop in year to date sales to 54,349 units from 72,695. 

Exports plunged by close to 38% to 1,235 units in August from 1,977 a year earlier and by over 41% to 10,586 year to date from 17,951, despite the launch in April of a new entry level Tivoli SUV in Europe with a 1.2-litre engine.

The company had struggled with mounting losses for some years and its performance deteriorated further this year as a result of the COVID-19 pandemic. In April owner Mahindra and Mahindra injected KRW40bn (US$33m) of fresh capital into the company to help keep it afloat, but this was seen as just a short term fix. 

The Indian parent in August reiterated its intention to sell its controlling stake in Ssangyong to a new strategic investor but no news has emerged so far of any bid.

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