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October 4, 2021updated 11 Oct 2021 10:42am

South Korean sales plunge 34% in September

The global shortage of semiconductors and the recent spike in coronavirus infections had a significant impact on vehicle production and sales.

By Graeme Roberts

Domestic sales by South Korea’s five main automakers combined plunged by 34% to 91,790 units in September 2021, from 138,530 units a year earlier, according to preliminary data released individually by the companies.

The data did not include sales by South Korea’s low-volume commercial vehicle manufacturers, including Tata-Daewoo and Daewoo Bus Corporation, as well as sales of imported vehicles which are covered in a separate report. Together these accounted for close to 15% of total vehicle sales in the country last year.

The global shortage of semiconductors and the recent spike in coronavirus infections had a significant impact on vehicle production and sales in the country last month while fewer working days due to national holidays also held back volume.

The government has extended the discounted 3.5% vehicle sales tax rate, down from 5%, until the end of the year to help support the local market.

All vehicle manufacturers suffered sharp falls in domestic sales last month with Hyundai reporting a 35% drop to 43,857 units and Kia a 30% decline to 35,801 units. Renault-Samsung’s domestic sales fell by almost 26% to 4,401 units and GM Korea’s were down by over 36% at 3,872 units, while Ssangyong was the worst performer with a 53% plunge to 3,859 units.

Overall domestic sales in the first nine months of the year were down by 10% at 1,074,653 units from 1,193,876 units in the same period of 2020.

Global sales by the country’s ‘big five’ automakers, including vehicles produced overseas by Hyundai and Kia, declined by almost 21% to 539,236 units in September 2021 from weak year earlier sales of 679,669 units, with the global shortage of semiconductors and the recent surge in coronavirus infections affecting production and sales domestically and overseas.

Total vehicle sales in the first nine months of the year were still up by almost 10% at 5,381,357 units from 4,899,307 units previously.

Overseas sales fell by over 17% to 447,446 units last month, from 540,968 units a year earlier, while year to date volume was up by over 16% at 4,306,704 units from 3,705,431 units as demand in key markets such as Europe, South America and Russia rebounded strongly from depressed year earlier levels.

Hyundai Motor’s global sales dropped by over 22% to 281,196 vehicles in September from 361,711 units a year earlier, reflecting declining domestic and overseas sales as the global shortage of semiconductors continued to affect production. Global sales in the first nine months of the year were still up by more than 12% at 2,925,859 units from 2,605,154 units in the same period of last year, driven by strong demand for SUVs such as the Palisade, Tucson and Santa Fe and also the Genesis luxury brand.

South Korea’s leading automaker continued to warn its global sales could slow further in the fourth quarter due to the recent surge in coronavirus infections and the ongoing semiconductor shortage, threatening its global full year sales target of an 11% increase to 4.16m vehicles from last year’s 3.74m.

Domestic sales plunged by almost 35% to 43,857 units last month, from 67,080 units a year earlier, which the company also blamed on fewer working days due to the South Korean ‘Thanksgiving’ holiday while cumulative nine-month sales were down by 7.3% at 540,842 units from 583,664 units previously.

Overseas sales fell by over 19% to 237,339 units in September, from 294,631 a year earlier, while the cumulative nine month total was still up by over 18% at 2,385,017 units, from 2,021,490 a year earlier, driven by rebounding demand in North and South America, Europe and Russia earlier in the year.

Kia’s global sales fell by over 14% to 223,593 vehicles in September, from 260,194 a year earlier, reflecting falling domestic and overseas sales which the company blamed on the continued semiconductor shortage and a resurgence of the coronavirus. Total volume in the first nine months of the year was still up by almost 14% at 2,119,623 units, from 1,864,470 a year earlier, with the Sportage SUV its best selling model globally.

Domestic sales plunged by over 30% to 35,801 units last month, from 51,211 a year earlier, and were down by over 3% at 402,348 units year to date from 415,010 units despite strong demand for the Sportage and Sorento SUVs and the Carnival MPV.

Overseas sales fell by over 10% to 187,792 units in September, from 208,812 a year earlier, with US sales down by 5% at 52,906 units while the cumulative nine month total was still up by over 18% at 1,716,275 units from 1,449,289 units, driven by rebounding demand in Europe and North America.

The company launched the EV6 electric vehicle in August and has stepped up promotion of its new K8 sedan as it targets a 12% rise in full year global sales to 2.92m units from just over 2.6m in 2020.

GM Korea’s global sales plunged by 66% to 13,750 vehicles in September, from 40,544 a year earlier, with the continued global semiconductor shortage affecting both domestic and export sales. Further production cuts have been announced for October.

In the first nine months of the year, the company’s global sales declined by 24% to 204,364 units from 268,959 units.

Domestic sales dropped by over 36% to 3,872 units last month, 6,097 a year earlier, and were down by over 22% at 46,663 units in the first nine months of the year from 60,075 units.

Exports plunged by over 71% to 9,878 units in September, from 34,447 units a year earlier, and by over 24% to 157,701 year to date from 208,949 units.

Renault-Samsung saw its global sales more than double to 14,747 vehicles in September from weak year earlier sales of 7,386 units, reflecting a strong rebound in overseas sales. In the first nine months of the year, global sales were still down by just over 1% at 90,552 units from 91,544 units previously.

Domestic sales continued to fall last month, by almost 26% to 4,401 units from an already weak 5,934 a year earlier, and were down by close to 42% at 42,783 year to date from 73,581 units, as the automaker faced increasingly tough competition from domestic rivals Hyundai and Kia and from imports.

Exports continued to rebound strongly in September, with volumes surging sixfold to 10,346 units from depressed year earlier sales of 1,452 units as the company stepped up shipments of the Renault Arkana-badged XM3 SUV to Europe.

In the first nine months of the year, exports were up by 166% at 47,749 units from 17,964 units.

Ssangyong Motor’s global sales fell by close to 40% to 5,950 vehicles in September, from 9,834 a year earlier, reflecting a sharp decline in domestic sales, and were down by over 17% at 61,854 units in the first nine months of the year from 74,707 previously.

Domestic sales fell by 53% to 3,859 units last month, from 8,208 a year earlier, and by 30% to 43,811 in the first nine months of the year from 62,557.

Exports continued to rebound in September by almost 29% to 2,091 units, from 1,626 a year earlier, and were up by almost 81% at 22,021 units year to date from 12,182 units.

Last month the automaker’s administrators, appointed by the Seoul Bankruptcy Court in April after the company filed for bankruptcy last December, said they expected to announce a preferred bidder for the company after inviting closed offers in July.

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