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Automotive Industry

Korea plagued by strikes, holiday and fewer working days - International Trends - vehicle sales

Automotive Industries, Oct, 2002 by Andrea Wielgat

New vehicle sales in Korea and exports out of the country fell during September as automakers lost selling and production days to a local holiday and supplier strike.

Korea's largest automaker, Hyundai Motor Co., saw sales drop 6.5 percent during the month to 137,559 vehicles. The company blamed the fall in sales on the Korean Thanksgiving holiday known as Chusok.

Kia Motor Corp., owned by Hyundai, also blamed the Chusok holiday for its 5.6 percent drop in sales. The company sold 85,581 vehicles during the month.

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Deep in a restructuring plan and on the verge of a sale to General Motors, Daewoo Motor Co. sales plummeted 58.6 percent to 18,717 vehicles during September. The ailing company was also hit by a strike by its parts suppliers. A two-week boycoft by Korea Delphi stopped production and cost Doewoo $12.54 million each day Delphi, which supplies 20 percent of Doewoo's pads, was demanding payment from Daewoo creditors for the parts it had already supplied.

The few bright spots in Korea came from its two smallest automakers--Renault Samsung Motors Inc. and Ssangyong Motor Co.

Sales of Ssangyong's sport-utility vehicles increased 6.4 percent during September. Ssangyong says strong demand for SUVs--including its popular Rexton--is spurring the growth. The company sold 11,353 units during the month.

Renault Samsung's sales soared 41 percent to 11,448 units on the heels of the launch of the compact SM3 passenger vehicle which arrived in dealerships at the beginning of the month and sold 4,708 vehicles. SM3 was expected to sell only 3,000 vehicles. The company's only other vehicle--the SM5 mid-size sedan--had a drop in sales from 8,102 vehicles in September '01 to 6,740 vehicles in '02. Renault Samsung is owned 70.1 percent by France's Renault SA,

Meanwhile, exports of Korean vehicles fell 2.8 percent in September. Daewoo exports fell 71.7 percent as the company stops shipping vehicles to North America. Kia exports were down 8.0 percent while Hyundai exports fell 0.3 percent. Ssangyong and Renault Samsung do not export vehicles in volume.

ANDREA WIELGAT is a Senior Editor of Automotive Industries.

Automotive Industry

Korea plagued by strikes, holiday and fewer working days - International Trends - vehicle sales

Automotive Industries, Oct, 2002 by Andrea Wielgat

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