July 4, 2022

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South Korean sales plunge in March

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Domestic sales by South Korea’s five main automakers combined fell 21% to 111,124 units in March 2022 from 140,971 units a year earlier, according to preliminary wholesale data released individually by the companies.

The data, as usual, did not include sales by low volume commercial vehicle manufacturers such as Tata-Daewoo and Edison Motors, as well as sales of imported vehicles which will be covered in a separate report later in the month.

The country’s leading vehicle manufacturers reported sharp declines in March which they blamed on continued shortage of semiconductors and the recent resurgence of the Covid pandemic in the country.

Hyundai local deliveries dropped 28% to 52,883 units last month while Kia’s sales were down by nearly 12% at 45,066 units; GM Korea 3,609 units (-41%); and Renault Korea 4,464 units (-22%).

Bankrupt Ssangyong was the only brand to report higher domestic sales, which increased by 19% to 5,102 units as confidence in the brand returned before its acquisition by a consortium led by Edison Motors collapsed at the end of the month.

First quarter domestic sales were down by over 16% at 296,631 units from 354,585 in the same period of last year.

Global sales among the country’s ‘big five’ automakers, including vehicles produced overseas by Hyundai and Kia, fell 10% to 608,398 units in March from 676,516 units a year earlier due to weaker domestic and overseas sales, while Q1 global sales were down by over 6% at 1,706,268 from 1,820,468 units.

Overseas sales fell by over 7% to 497,274 units in March from 535,545 a year earlier and by 4% at 1,409,637 units year to date from 1,465,883 units, reflecting also tight supplies of semiconductors.

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Hyundai Motor global sales fell 17% to 313,926 vehicles in March from 378,246 a year earlier, with domestic and overseas sales both sharply lower which the automaker blamed on continued shortages of components, rising raw material costs and the resurgence of the Covid pandemic. Q1 global sales were almost 10% lower at 901,903 units from 999,828 a year earlier.

Domestic sales plunged by over 28% to 52,883 units last month from 73,810 a year earlier, while year to date sales were down by 18% at 152,098 from 185,413 units. Overseas sales fell by over 14% to 261,043 from 304,436 units in March and by over 8% to 749,815 in the first quarter from 814,415 units.

Earlier this year Hyundai said it expected its global sales to rise by over 11% to 4,323,000 vehicles in 2022, driven by a 13.5% rise in overseas sales to 3,591,000 units and a slight rise in domestic sales to 732,00 units. The automaker last month said it will “minimise the impact of business uncertainties such as the global chip shortage, by optimising production, diversifying business strategies tailored for each region and launch new battery electric models including the electrified GV70 and Ioniq 6 this year”.

Kia global sales fell slightly in March, to 250,646 vehicles from 252,943 a year earlier, reflecting weaker domestic sales while overseas volume improved slightly. In the first three months of the year, its global sales were down just slightly at 685,358 units, from 689,990 a year earlier, with deliveries still affected by tight semiconductor supplies and the spread of the Omicron Covid variant.

Domestic sales fell by nearly 12% to 45,066 units last month from 51,011 a year earlier and were down by over 6% at 121,664 units year to date from 130,075 units. Overseas sales increased by 2% year on year to 205,580 units in March from 201,932, while cumulative sales were just slightly higher at 563,694 units compared with 559,915 units.

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In January the automaker said it expected global sales to grow by 14% to 3.15 million units in 2022, including 562,000 domestic sales and 2.59 million overseas, helped by new models such as the EV6 GT and the redesigned Niro.

GM Korea global sales fell by over 16% to 24,821 vehicles in March from 29,633 a year earlier, reflecting weaker domestic and overseas sales as the automaker continued to struggle with the global semiconductor shortage.

Q1 sales were down by 33% at 60,583 units from 90,023 units previously, following by a 44% plunge in the first two months of the year.

Domestic sales dropped 41% to 3,609 units in March from 6,149 units a year earlier and 57% to 7,399 year to date from 17,353 units. Exports fell 10% to 21,212 units last month, from 23,484 units while cumulative volume was down nearly16% at 64,751 from 76,652 units.

GM Korea said it planned to launch the Tahoe full size SUV in April to help strengthen its domestic lineup, to be followed by the GMC Sierra pickup truck later this year. A spokesman said the company would “focus on producing compact SUVs such as the Trax in South Korea and bring in large size SUVs from the US, as part of a ‘two-track’ SUV strategy”.

Last December the company said it planned to launch 10 new electric vehicle models in South Korea by 2025, all of which its plans to import from North America.

Renault Korea saw its global sales rise by 21% to 10,409 vehicles in March from weak year earlier sales of 8,572 units, reflecting the continued strong rebound in overseas sales. Q1 global sales were up by 60% at 35,236 from 22,068 previously.

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Domestic sales fell by 22% to 4,464 units in March from 5,695 a year earlier and by almost 4% to 12,659 year to date from 13,129 units. Exports doubled year on year to 5,945 units last month, from 2,877 units, while cumulative volume was up 153% at 22,577 from 8,939 as the company continued to step up shipments of the XM3 and QM6 SUVs to Europe.

Ssangyong Motor global sales increased nearly 21% to 8,596 vehicles in March from 7,122 units a year earlier, reflecting a strong rebound in domestic and overseas sales. Cumulative three month sales were up by almost 25% at 23,188 units from 18,559 units.

Domestic sales increased 19% to 5,102 units in March, from 4,306 a year earlier, while Q1 volume was up by nearly 15% at 14,478 from 12,627 units. Exports increased 24% to 3,494 units in March from 2,816 a year earlier and were up 48% at 8,800 year to date from 5,962 units. The company launched its first battery powered SUV last month, the Korando e-Motion, to strengthen domestic sales.

The collapse of the Edison Motor deal to acquire Ssangyong at the end of March will inevitably affect confidence in the brand, even though a new potential domestic buyer has since emerged.

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