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July 2, 2020

South Korean sales jump 41% in June

Domestic sales by South Korea’s five largest automakers combined continued to rebound in June 2020, by over 41% to 176,468 units from 124,963 units in the same month of last year, according to preliminary data released individually by the companies.

By bcusack

Domestic sales by South Korea’s five largest automakers combined continued to rebound in June 2020, by over 41% to 176,468 units from 124,963 units in the same month of last year, 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.

The domestic vehicle market has seemingly shrugged off broader concerns regarding the global COVID-19 pandemic with sales rebounding strongly in the second quarter of the year after a sharp decline in the first quarter when manufacturers were forced to close plants due to supply chain disruptions and efforts to limit the spread of the disease. South Korea has managed the coronavirus outbreak better than most in Asia, with its quick implementation of track and trace systems, and this is reflecting in the quick return to near normal, day to day activity.

All five vehicle manufacturers enjoyed stronger domestic sales in June, helped by new model launches, with the smaller brands posting some of the biggest gains. Renault-Samsung’s sales jumped by close to 81% to 13,668 units last month, while GM Korea’s sales were up by almost 62% at 9,349 units. Kia’s sales rose by over 41% to 60,005 units, while Hyundai reported a 37% increase to 83,700 units. More modest gains were made by Ssangyong, of just under 19% to 9,746 units.

In the first six months of 2020, domestic sales by the big five automakers were almost 6% higher at 800,088 units from 755,037 units in the same period of last year.

Global sales among the country’s ‘big five’ automakers, including vehicles produced overseas by Hyundai and Kia, continued to fall sharply in June, by 19% to 549,684 units from 678,539 units a year earlier – reflecting plunging overseas sales. Global sales in the first six months of the year were down by close to 22% at 3,033,798 units from 3,866,229 units a year earlier.

Overseas sales, including exports and vehicles produced overseas by Hyundai and Kia, plunged by almost 33% to 373,216 units last month from 553,792 units a year earlier, as economic activity in key overseas market continued to decline due to measures taken to help contain the global COVID-19 pandemic. Overseas sales in the first six months of the year were down by over 29% at 2,206,074 units from 3,113,214 units in the same period of last year.

Hyundai Motor‘s global vehicle sales fell by close to 23% to 291,854 units in June from 377,396 units a year earlier, reflecting sharply lower overseas sales. In the first six months of the year global its sales were down by over 25% at 1,589,429 units from 2,126,307 units previously.

Hyundai’s domestic sales jumped by over 37% to 83,700 units last month from 60,987 units a year earlier, with deliveries rebounding strongly after the extensive plant shutdowns and supply chain disruption that took place earlier in the year. First half domestic sales were slightly higher at 384,613 units from 384,113 units.

Hyundai enjoyed a strong domestic sales rebound in the second quarter, underpinned by recent new model launches including the new generation Avante and Genesis G80 passenger cars, the new GV80 SUV and the upgraded Sonata. This week the company unveiled the new Genesis G90 and the revised Santa Fe SUV.

Overseas sales plunged by over 34% to 208,154 in June from 316,409 units a year earlier, with many overseas markets still struggling to recover from the recent economic lockdowns intended to help slow the spread of the COVID-19 pandemic. In the first six months of the year overseas sales were down by almost 31% at 1,204,816 units from 1,742,194 units previously.

Kia Motors‘ global sales fell by close to 12% to 207,406 vehicles in June from 235,847 units a year earlier, reflecting a sharp decline in overseas sales. Total sales were down by over 14% at 1,161,246 units in the first half of the year from 1,352,629 units a year earlier.

Domestic sales increased by over 41% to 60,005 units last month from 42,405 units a year earlier, as sales continued to rebound from production shutdowns and supply chain disruption earlier in the year. Domestic sales in the first six months of the year were almost 15% higher at 278,286 units from 242,870 units a year earlier, driven by strong demand for SUV models such as the Sorento, Seltos and Sportage. This week the company launched an upgraded version of the Seltos to help strengthen sales further.

Overseas sales plunged by almost 24% to 147,401 units in June from 193,442 units a year earlier, with key overseas markets struggling with declining economic activity due to the COVID-19 epidemic. Overseas sales in the first six months of the year were down by over 23% at 853,234 units from 1,110,676 units.

GM Korea‘s global sales fell by 29% to 25,983 vehicles in June from 36,451 units in the same month of last year, reflecting sharply lower overseas sales. The company’s total sales in the first six months of the year were down by over 28% at 166,098 units from 231,172 units a year earlier. Domestic sales jumped by almost 62% to 9,349 units last month from 5,788 units a year earlier, helped by the recent launch of the locally-made Trailblazer SUV and strong demand for the Transverse model. Local sales in the first half of the year were more than 15% higher at 41,092 units from 35,598 units previously.

General Motors confirmed it was still committed to the South Korean market and said it would make increasing use of the country’s favourable zero emission vehicle policies starting with the launch of the new generation Bolt electric vehicle last month.

Overall exports fell by almost 46% to 16,634 units in June from 30,663 units a year earlier and by more than 35% to 124,946 units in the first six months of the year from 195,574 units. 

Renault-Samsung, 80%-owned by France’s Renault, saw its global sales fall by close to 24% to 14,260 units in June from 18,686 units in the same month of last year, with a sharp rise in domestic sales more than offset by plunging exports. Total volume in the first six months of the year fell by over 21% to 67,666 units from 85,844 in the same period of last year.

Domestic sales continued to rebound strongly last month, by close to 81% to 13,668 units from 7,564 units a year earlier, driven by the recent launch of the new XM3 SUV and strong demand for the larger revised QM6. Local sales year to date increased by over 51% to 55,242 units from 36,506 units.

Exports plunged by close to 95% to 592 units in June from 11,122 units a year earlier, reflecting mainly the discontinuation of export orders for the Rogue SUV from Nissan Motor of Japan. Export volume in the first half of the year was down by close to 75% at 12,424 units from 49,338 units.

Ssangyong Motor, majority-owned by Mahindra & Mahindra, reported a slight increase in global sales to 10,181 units in June from 10,159 units a year earlier, with stronger domestic sales more than making up for a sharp drop in exports. Overall sales in the first six months of the year were down by close to 28% at 49,387 units from 68,189 in the same period of last year. 

Domestic sales rose by almost 19% to 9,746 units last month from 8,219 units a year earlier, resulting in a 35% drop in year to date sales to 40,855 units from 55,950 units. 

Exports plunged by almost 80% to 435 units in June from 2,156 units previously and by over 38% to 8,564 units in the first half of the year from 13,895 units. In April the company launched a new entry level version of its Tivoli SUV in Europe, fitted with a 1.2-litre engine, to help lift overseas sales.

The company has struggled with mounting losses for some years and its performance this year deteriorated further as a result of the COVID-19 pandemic. In April Mahindra and Mahindra injected KRW40bn (US$33m) to help keep the company afloat but this was seen as just a short term fix and the Indian parent has since made clear it is looking to sell its stake in the automaker. In May Ssangyong sold its main service centre in Guro, Seoul, in a sale and leaseback deal to help improve liquidity.

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