Industrial action continued to hold back production at Hyundai and Kia and this was the main reason for the decline in overall domestic sales.

Industrial action continued to hold back production at Hyundai and Kia and this was the main reason for the decline in overall domestic sales.

Domestic sales by South Korea's five main automakers declined 13.3% year on year to 126,660 units in October, from 146,106 units in the same month of last year, according to preliminary data released individually by the country's vehicle manufacturers.

The data does not include sales by South Korea's low volume commercial vehicle manufacturers, including Tata-Daewoo and Daewoo Bus Corporation, which typically account for up to 2% of the domestic market combined.

Also not included in the data are sales of imported vehicles which accounted for close to 15% of the total vehicle market last year. These are covered in a separate report when the data is released later in the month.

Industrial action continued to hold back production at Hyundai and Kia and this was the main reason for the decline in overall domestic sales. Underlying demand has also weakened since the government readjusted the automotive sales tax to its normal rate of 5% at the end June from the previously discounted rate of 3.5%.

In the first 10 months of the year, domestic sales were up by just 1.3% at 1,278,905 units from 1,262,685 units in the same period of last year with strong first half growth almost entirely wiped out by sharp declines in the last three months.

Global sales among the country's 'big-five' automakers, including vehicles produced overseas by Hyundai-Kia, declined 5.8% to 767,657 units in October from 815,294 units a year earlier, reflecting sharply lower domestic sales and moderately weaker overseas sales.

In the first 10 months of the year, global sales fell 1.9% to 7,106,470 units, from 7,241,754 units previously, on lower overseas sales.

Overseas sales, including overseas production by Hyundai-Kia, fell by 4.2% to 640,997 units in October from 669,189 units a year earlier. Year-to-date sales were 2.5% lower at 5,827,557 units compared with 5,979,457 units previously.

Hyundai Motor's global sales fell by 10.2% to 411,449 units in October, from 458,375 units a year earlier, reflecting sharp declines in both domestic and overseas sales.

Industrial action at its domestic plants continued in October which had a significant impact on domestic and overseas sales. In the first 10 months of the year, Hyundai's global sales were 2.7% lower at 3,890,775 units, compared with 3,997,612 units in the same period of last year.

Hyundai's domestic sales plunged by just over 30% to 47,186 units last month, from 67,807 units a year earlier, with deliveries held back by a sharp drop in domestic production. Overall market demand has also softened since the expiry of the discounted sales tax in June.

The sharp drop in domestic sales in the last three months wiped out the strong growth Hyundai enjoyed in the first half of the year, with cumulative ten-month sales falling by 6.5% to 529,853 units from 566,895 units in same period of last year.

Overseas sales declined by 6.7% to 364,263 units in October from 390,568 units a year earlier, with falling domestic output also having a significant effect on CBU exports. Cumulative 10-month overseas sales, including vehicles produced overseas, were 3.5% lower at 2,488,847 units compared with 2,579,963 units previously.

Kia Motors' global sales fell by 3.6% to 259,243 units in October, from 268,954 units a year earlier, reflecting a sharp drop in domestic sales and slightly lower overseas deliveries. Cumulative 10-month global sales were 2.2% lower at 2,401,828 units, compared with 2,456,611 units a year earlier.

Domestic sales fell by 14.1% to 40,034 units last month, from 46,605 units a year earlier, with deliveries severely affected by domestic industrial action as well as an overall softening of the domestic market. Cumulative 10month volumes were just 2.8% higher at 436,494 units, compared with 424,593 units a year earlier, reflecting the brand's strong first-half performance.

Overseas sales fell by 1.4% to 219,209 units last month from 222,349 a year earlier, with a 26% rise in overseas output cancelled out by a 33% drop in CBU exports from and falling inventories. Year to date overseas sales were 2.2% lower at 1,965,334 units.

GM Korea's global sales rose by just over 1% to 55,269 units in October, from 54,671 units a year earlier, with weak exports offset by strong growth in domestic sales. Cumulative global sales in the first 10 months of the year were 3.9% lower at 489,842 units, compared with 454,811 units in the same period of last year.

The data do not include exports of CKD kits for assembly overseas, which are substantial.

Domestic sales rose by more than 14% to 16,736 units last month, from 14,645 units a year earlier, resulting in a more than 12% rise in cumulative 10-month sales to 144,726 units.

Shipments of CBUs to overseas markets fell by 3.7% to 38,533 units in October, from 39,996 units a year earlier, resulting in a year to date drop of 9.4% to 345,116 units.

Renault-Samsung's global sales rebounded strongly in October, by more than 40% to 27,968 units from 19,935 units a year earlier, after declining by almost 39% year on year in the previous month due to disruption caused by a key new model changeover.

In the first 10 months of the year the company's global sales rose by 9% to 199,179 units, compared with 182,655 units in the same period of last year.

The recent launch of the new SM6 mid-size passenger car and the new QM6 crossover SUV helped domestic sales jump by 89% to 13,254 units last month compared with weak year earlier sales of 7,011 units. Year to date domestic sales were up by more than 34% at 84,458 units.

Exports recovered in October after the successful full model changeover of the QM6/Nissan Rogue SUV. Overseas shipments rebounded by 13.9% year on year to 14,714 units after declining by 72% in the previous month. In the first 10 months of the year, CBU exports were 3.5% lower at 114,721 units.

Ssangyong Motor, owned by India's Mahindra & Mahindra, reported a 2.8% rise in sales of built-up vehicles to 13,728 units in October from 13,359 units a year earlier, driven by strong overseas demand for the Tivoli SUV.

Cumulative 10-month global sales were 6.9% higher at 125,321 units, compared with 117,233 units in the same period of last year.

Domestic sales fell by 5.6% to 9,450 units last month but were up by close to 5.2% at 83,379 units over the 10-month period. Exports jumped by close to 28% to 4,278 units on strong EU demand for the new Tivoli Air SUV and demand from emerging markets such as Iran. Year to date exports rose by 10.7% rise to 42,032 units.

South Korean carmakers: domestic/overseas sales by brand, October 2016
BrandsDomesticOverseasGlobal
Hyundai47,186364,263411,449
Kia40,034219,209259,243
GM Korea16,73638,53355,269
Renault-Samsung13,25414,71427,968
Ssangyong9,4504,27813,728
Total126,660640,997767,657
Sources : www.AsiaMotorBusiness.com, industry sources.

Auto market intelligence
from just-auto

• Auto component fitment forecasts
• OEM & tier 1 profiles & factory finder
• Analysis of 30+ auto technologies & more