Will money-losing Ford, Jaguar exit Korea?
Both carmakers’ sales dropped more than 30% in 2023
Ford and Jaguar are on the verge of exiting the Korean market, as they experience a gradual decline not only in sales but also in overall brand identity, due to customers’ increasing preference for home-grown players and a limited number of German luxury automakers, according to data and company officials, Monday.
The outlook reflects their worsening revenues, primarily triggered by plummeting vehicle sales. According to an audit report by Ford Sales and Service Korea, the automaker reported an operating loss of 4.92 billion won ($3.55 million) in 2023. Its net loss also came in at 19.5 billion won during the same period, hit by a drastic sales drop of 30.25 percent last year compared to 2022.
Other data from the Korea Automobile Importers & Distributors Association (KAIDA) showed the automaker sold 3,450 vehicles last year, down 55.9 percent from 2022. Ford’s luxury arm, Lincoln, also ended up selling only 1,658 cars here, down 34.9 percent during the same period. Both automakers sold more than 10,000 vehicles combined in 2021, but the figure almost halved two years later.
A spokesperson for Ford Sales and Service Korea was unavailable for comment.
The Park Motors, the authorized dealer of Ford’s local subsidiary, also ended up reporting an operating loss of 4.2 billion won last year amid the sluggish sales performance.
Jaguar is another struggling auto brand here. The brand decided to suspend sales of its vehicles from the latter half of 2023 amid a drastic sales fall. According to KAIDA data, Jaguar sold more than 4,100 vehicles in 2017, but it has since failed to recover its old glory. In 2022, its sales stood at only 163 vehicles.
Jaguar Land Rover Korea denied rumors of its possible exit from the Korean market, saying that it will resume sales of its new electric vehicles sometime in 2025.
Earlier, a group of imported automakers opted to exit the Korean market after struggling to compete with two major domestic automakers, Hyundai Motor and Kia, as well as two German luxury carmakers, Mercedes-Benz and BMW. Back in 2020, Japan’s Nissan and Infiniti pulled out of the Korean market. French auto brand Citroen also left the local market in 2022 amid falling sales.
Despite ongoing struggles among other automakers, Mercedes-Benz and BMW are experiencing increasing popularity among Korean customers. Their combined sales accounted for more than half of the total imported vehicle sales here in 2023, according to data from KAIDA.