Korea's auto market will likely shrink 1 percent on-year in 2013 due mainly to a slowdown in the country's economy, a report said Thursday.
According to the report by the Korea Automotive Research Institute (KARI), car sales here will reach an estimated 1.53 million vehicles next year, compared with an estimate of 1.55 million units for the whole of 2012. The 2012 sales estimate represents a 2.1 percent decline from the previous year.
"Domestic car sales will remain sluggish next year due to a slowing economy, no possible plans for new car releases, and the closure of tax reduction benefits," said KARI in a report.
The South Korean government cut special consumption taxes on vehicles temporarily last month in a bid to boost domestic demand, but the tax-cut plan is scheduled to be over at the end of the year.
The country's central bank lowered the 2013 economic growth forecast to 3.2 percent from 3.8 percent. It also revised down the growth outlook for this year to 2.4 percent from 3 percent.
However, KARI said Korea's car exports are expected to gain 1.2 percent on-year to 3.31 million units next year, with 4.71 million vehicles produced, up 0.4 percent on-year.
Sales of imported cars in Korea will rise 3.9 percent on-year to 134,000 vehicles in 2013, a slowdown from an estimated 20 percent jump in 2012, said KARI.
The KARI report said the global auto market is also predicted to experience a slowdown in sales next year due to lingering economic uncertainties.
Total car sales throughout the world will advance 3.4 percent on-year to 80.8 million units in 2013, compared with an 11.9 percent expansion in 2012.
The United States and China will see steady growths in their car markets, while car sales in Europe are expected to stay nearly unchanged, noted KARI. (Yonhap)