Automobile Exports Advance 1.3% to $3.8 Billion in June

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Friday, July 21st, 2017
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Photo: General Motors Company

The Ministry of Trade, Industry and Energy(MOTIE) in South Korea announced on July 13 that automobile exports expanded 1.3 percent to USD 3.8 billion from a year ago, marking the fifth consecutive month of growth.

The number of vehicles shipped abroad, as opposed to the value in dollars, grew 0.8 percent year-on-year to 240,475, thanks to strong sales in Europe and Central and South America despite the decline in sales in North America, the largest market for Korean automotive makers.

Domestic sales declined 11.3 percent to 164,719 vehicles -- the sales of cars produced in Korea down 13.2 percent and those of imported vehicles up 0.4 percent -- as consumers wait for new vehicle launches.

Due to slower sales, domestic automobile production by five companies, Hyundai Motor, Kia Motors, GM Korea, Ssangyong Motor, and Renault Samsung Motors, contracted 2.9 percent to 382,807 units.

Throughout the first half of 2017, automobile exports advanced 4.2 percent to $21.5 billion while domestic purchases and production of vehicles shrank 3.4 percent to 903,449 units and 1.5 percent to 2,162,548 units, respectively.

Exports in terms of value returned to growth for the first time since the first half of 2014 thanks to robust sales of eco-friendly cars, large-size vehicles, and sports utility vehicles (SUVs) with relatively higher price tags. Between January and May this year, outbound shipments of eco-friendly vehicles soared more than fivefold to 70,196 units from the same period of 2016, and an average price of an exported vehicle rose by 6 percent to $15,029.

The number of exported vehicles inched down 0.8 percent to 1,324,710 in the first six months of 2017 due to a 6.4-percent decrease in sales in North America. Shipments to most regions went up with those to Europe surging 34.3 percent.

Domestic sales contracted compared to the first half of 2016 when temporary tax cuts on vehicle purchases boosted consumption. Purchases of vehicles manufactured in Korea declined 3.4 percent to 776,128 units with the sales of small and compact cars dropping at double-digit rates. Sales of imported vehicles shrank 2.8 percent to 127,321 units.

Production by five Korea-based automotive makers declined due to slower domestic sales and halted production of certain vehicle models.

Outbound shipments of automobile parts decreased 5.6 percent to $11.9 billion because of reduced production in Korean manufacturers’ overseas plants. Exports of automobile parts to North America and Asia, in which sales of Korean brand vehicles contracted and production at Korean manufacturers’ plants slowed, went down 7.4 percent to $4.4 billion and 8.7 percent to $3.7 billion, respectively.

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