Hyundai Motor to struggle in local market

By Park Jin-hai

Hyundai Motor and its sister firm Kia Motors will continue to struggle in the local market this year as BMW, Mercedes-Benz and other imported car brands battle for bigger shares of the market. In addition, GM Korea, Renault Samsung and Ssangyong Motor are poised to attract more customers away from Korea’s largest automotive group by introducing a series of new diesel-powered, fuel-efficient sedans and compact sports utility vehicles.

After achieving global sales of 8 million vehicles last year, Hyundai Motor Group, has said that it plans to sell 8.2 million cars at home and abroad in 2015, up 4.3 percent from last year’s target of 7.86 million.

Hyundai Motor’s sales target is 5.05 million, representing an increase of 3.1 percent, while the target set by Kia Motors target is 3.15 million, which would be a 6.4 percent growth if achieved.

However, on the domestic market, Hyundai predicts that sales will reach 690,000 units this year, only a 1.2 percent rise from last year’s sales target of 682,000 units, while Kia’s sales target remains unchanged from last year.

Faced with an encroachment from imported vehicles on the market, Hyundai and Kia Motors have continued to lose local presence where their combined market share stood below 70 percent for the first time last year.

Last year, Hyundai has outsold its sales target by 3,191 on the local turf, while Kia’s sales were 12,000 short of its annual target for last year, selling 465,200 units.

Hyundai’s domestic sales last year was up 6.9 percent from the previous year, while Kia’s domestic sales was up 1.6 percent during the same period.

In contrast, all other Hyundai’s local rivals Renault Samsung Motors, GM Korea and Ssangyong Motor have all seen their domestic sales exceed their initial targets by as much as 30 percent.

Renault Samsung saw its local sales at 80,003 units last year, a 33.3 percent growth from a year earlier. For this year, it came out with aggressive sales targets of an additional 30 percent increase.

GM Korea also achieved record-high domestic sales last year at 154,000 units, up 2.2 percent from the previous year, while Ssangyong sold 69,036 units domestically, up 7.9 percent from a year earlier.

According to Korea Automotive Manufacturers Association (KAMA), domestic automotive market is projected to grow to 1.65 million units, up 2.5 percent. The local automakers are forecast to sell 1.4 million this year, a drop from 1.45 million sold last year, while imported vehicles has been predicted to see their domestic sales reach 250,000 or up 20 percent this year.

The market share for imported vehicles market has been forecast to jump to 15.2 percent this year from 13 percent.