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August 11, 2020

South Korean import sales rise 2% in July

Sales of imported light passenger vehicles in South Korea increased by 1.7% to 19,778 units in July 2020 from 19,453 in the same month of last year, according to member data released by the Korea Automobile Importers & Distributors Association (KAIDA).

By bcusack

Sales of imported light passenger vehicles in South Korea increased by 1.7% to 19,778 units in July 2020 from 19,453 in the same month of last year, according to member data released by the Korea Automobile Importers & Distributors Association (KAIDA).

This was much slower than the 10% growth reported in the same month by the five main domestic vehicle manufacturers combined, after leading brands such as Hyundai and Kia intensified their new model launches in the last few months. 

South Korean consumers in July continued to shrug off growing concerns over the global COVID-19 pandemic, helping the imported vehicle market grow by almost 15% to 148,014 units in first seven months of 2020 compared with 128,767 units in the same period of last year.

German brands continued to dominate this segment, with combined sales rising by 39.5% to 97,600 units in the seven month period, to account for more than 65% of total imports.

Mercedes-Benz remained the leading import brand, with sales rising by 2.8% to 41,583 units year to date, while BMW reported an almost 35% sales rise to 29,246 units as the company continued to recover from a damaging recall campaign in 2018.

Volkswagen has also made good progress in rebuilding its market presence, with its seven month sales rising by 167% to 8,523 units, while Audi's sales were up almost fivefold at 12,421 units with the brand rebounding strongly from a 46% decline in the first two months of the year. Porsche's sales doubled to 5,287 units in this period.

Japanese brands continued to suffer from a broad based consumer boycott after a diplomatic spat broke out between the two countries last year.

Combined Japanese sales fell by over 55% to 11,657 units year to date with Lexus sales falling by almost 54% to 4,346 units.

Nissan Motor in May announced it will withdraw from the South Korean market by the end of 2020 as part of a global restructuring plan which includes refocusing on larger, more profitable markets worldwide. The company also cited anti Japanese sentiment as one of the reasons for quitting South Korea.

Tesla, which enjoyed a strong surge in sales to 7,079 units in the first half of 2020 from 422 units a year earlier, is now being investigated by the South Korean Ministry of Land Transport for possible faults in its assisted driving system, which may lead to a costly recall. Tesla's sales are not included in the KAIDA data.

A separate report suggested the South Korean government is looking into cutting Tesla out of its generous electric vehicle incentive programme, after strong local demand for its vehicles resulting in the US company accounting for an estimated US$200m, or around half, of the country's total EV incentive pay-outs so far this year. 

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