Korea aims to produce 4.6 million vehicles in 2014
New Hyundai Sonata to compete against imported cars
Korean vehicle production in 2013 decreased by 0.8% year-over-year (y/y) to 4.52 million units (excluding the imported cars). Sales in Korea fell 1.9% to 1.38 million units in the face of surging imports. Meanwhile, exports from Korea also dropped 2.6% to 3.09 million units partly because of the appreciation of the Korean Won for these two years. According to the outlook announced by Korea Automobile Manufacturers Association (KAMA) in February 2014, production in Korea for 2014 will rise to 4.6 million units, a 1.7% increase y/y. Sales in Korea are expected to edge up by 1.2% y/y to 1.40 million units, while exports from Korea will grow by 3.6% y/y to 3.2 million units.
Hyundai Motor Group has been losing its market share in Korea to growing imported cars. The group reported sluggish sales in the developed markets including Europe and the U.S. while it experienced growth in production and sales in China and other emerging markets. In order to enhance business in China, Hyundai Motor Company plans to build a new plant in Chongqing.
According to LMC Automotive's forecast in March 2014, Korean light vehicle production will rise to 4.56 million units in 2014, but will fall to around 4.45 million units in 2015-2016. Hyundai's launch of the redesigned Sonata is expected to boost production in 2014, while GM's plan to end sales of Chevrolet vehicles in Europe should reduce output in Korea in 2015-2016. LMC Automotive anticipates that production will rebound to 4.54 million units in 2017.
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