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Tuesday, July 01, 2008

South Korean automakers posts sales growth in the USA automarket

Where the big Detroit three are grappling with downward sales Japanese and South Korean automakers are registering exceptional growth in the USA auto market. The rise of fuel-efficient vehicles has kept the auto sales from falling sharply. The combined sales of South Korean automakers in June registered a 9.2% annual rise. The strong demand of South Korean brands is making up for lower sales in their domestic market. Analysts are expecting that the new trend of fuel efficient cars will continue in the second half of 2008.

In June, the five South Korean automakers: Hyundai Motor Co.(SEO: 005387), Kia Motors Corporation (SEO: 000270), GM Daewoo Auto & Technology, Ssangyong Motor (SEO:003620) and Renault Samsung Motors sold a total of 490,342 units. In 2007, their combined sales in the USA was 449,043. CNN reports:

Domestic sales fell 7.2% on year to 97,591 units from 105,169 units, while exports rose 14% to 392,751 units from 343,874 units.

Increased overseas capacity at Hyundai and Kia, which together form the world's fifth-largest car manufacturer by sales, will help boost overall sales of South Korean carmakers in the second half, said Hyundai Securities analyst Cho Soo-Hong.

In 2007, the Hyundai-Kia Automotive Group emerged as the world's No. 5 carmaker (up from No. 6 in 2006) with global sales of 3,961,629 units, according to Automotive News' 2008 Global Market Data Book issued Monday.

Jeff Lee, an analyst at Hana Daetoo Securities Co. Ltd. estimated that Hyundai is going to export about 50,000 units in 2008 in the USA. Last year, they imported 49,000 units accounting 4% of the total auto sales in the USA. Overall, in these six months, the five South Korean car makers posted an 8.7% increase in annual sales from 2.61 million a year ago, to 2.83 million.

Related article:
CNN

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