GM, Renault Samsung, Ssangyong make headway
Korea’s auto market is set to witness one of the most significant and dramatic changes in years, but one that may greatly benefit local consumers, market observers said Friday.
Ironically, however, such a dramatic and yet positive change will come from a relative retreat by two of the largest carmakers here — Hyundai Motor and its smaller affiliate Kia Motors.
Together, Hyundai and Kia form Hyundai Motor Group, the world’s fifth-largest automotive giant by sales.
They have long dominated, if not monopolized, the local market since Hyundai Motor took over then-defunct Kia Motors in 1998.
Their combined domestic market share has remained closer to 80 percent than 70 percent, while their combined global sales have shot up to over 8 million cars.
This year, however, the two automakers’ domestic market share is expected to drop below the 70 percent mark for the second time in their joint history.
In the first 10 months of the year, their combined market share here came to 65.5 percent, while their market share in October alone came to 58.9 percent, marking the first time in their history that their market share has dropped below 60 percent.
Such a drop has been attributed to prolonged labor disputes at the companies’ production facilities.
Union workers of Hyundai and Kia each held over 20 rounds of strikes this year, together causing some 5.2 trillion won ($4.46 billion) in missed production, approximately 249,000 cars worth, for the two carmakers.
They are apparently seeking to re-solidify their market dominance, planning to launch seven new vehicles here next year in one of the most aggressive unveiling schedules ever.
Many, however, believe the companies’ regaining control of the local market may do more harm than good, especially for local customers.
“The near monopoly by Hyundai and Kia causes price hikes, and in such market conditions, customers are bound to be left with fewer options,” a market observer said, while speaking on the condition of anonymity.