Have you ever heard about some domestic consumers who import Korean-made cars from the United States? What’s the benefit of such a purchase? They can buy Hyundai or Kia models at cheaper prices even though they have to pay import duties.
More and more Koreans may turn to this odd buying behavior to save money. Bringing in exported Korean cars has stemmed from local automakers’ misguided price policy in which they sell cars cheaper abroad than at home. It is somewhat understandable that car manufacturers have long exported cars at discounted prices to maintain their competitive edge against global giants.
However, it is no exaggeration to say that local motorists have paid virtual subsidies to Hyundai Motor, Kia Motors and other carmakers to help them export more. But now, the time has come to terminate the dual price system that discriminates against Korean consumers. Actually, the nation’s two leading carmakers ― Hyundai and its affiliate Kia ― are expected to continue their record-breaking earnings spree this year, boosted by their brisk sales at home and abroad.
It seems that the two firms have grown more arrogant than ever because of their strongest-ever performances. They are not willing to listen carefully to public concerns that they have taken domestic consumers hostage for maximizing their profit. In fact, Hyundai and Kia have long dominated the Korean car market, making little room for consumer choice.
Local consumers have also been complaining about the quality of cars. It has been no secret that the automakers export better quality cars equipped with up-to-date airbags and other safety gadgets. They usually install six airbags in each car to be exported to the U.S., while most cars for domestic use have only two airbags.
The carmakers’ strategy apparently sends a wrong message that safety of overseas buyers is more important than that of local drivers. What baloney! The story does not stop here. The Korean firms provide a much longer period of warrantee services for overseas buyers than domestic ones.
No one can deny that the auto companies have tenaciously stuck to the outdated policy of export promotion that was prevalent in the 1970s and 80s even at the cost of local consumers’ interests. It goes without saying that Hyundai and Kia cannot become the word top-class automaker by keeping the anachronistic strategy.
They should learn a lesson from the crisis of Toyota that lost consumer confidence due to massive recalls of cars with serious defects worldwide in 2009. Executives of the Korean makers must realize that their arrogance over consumers will only invite woes. We call on them to shift their focus from export first to consumer first. They also need to share their profits with domestic consumers ― the driving force behind what Hyundai and Kia are today ― by supplying cheaper cars with better quality.