Used Korean cars hot property overseas
Exports of used cars are growing in tandem with the rising popularity of and confidence in Korean vehicles overseas, as consumers turn to Web sites like Autowini.com or participate in local used car auctions, among other routes.
Korea shipped 289,161 used cars worth $1.5 billion last year, according to the Korea Used Car Export Association, up from 217,097 in 2007.
“Demand is increasing as new cars made by local automakers are becoming popular abroad,” said Choi Mun-suk, an executive at SK Encar, which runs the Autowini.com site.
“Korean cars are well-made but relatively cheap. Customers in developed countries such as the United States and Britain purchase components [for cars they already have], whereas those in developing countries tend to buy secondhand sedans, sport utility vehicles and buses.”
SK Encar, the country’s biggest used car trader, opened the business-to-business Web site in 2009.
It now has 20,000 members - including over 15,000 buyers and more than 4,500 sellers - in 186 countries.
Any company can trade their vehicles on the site, and there are more than a few Toyotas, Hondas and Nissans being sold there to developing countries.
“Japan’s market is not as open as the one represented by Autowini.com,” said Yim Min-gyeong, a spokeswoman for SK Encar.
The company started exporting used cars from Korea in 2006.
It delivered 84 vehicles to countries including Thailand that year but saw the number jump to 3,639 in 2011.
Local auctions also report more demand from foreign buyers.
Hyundai Glovis, a logistics arm of Hyundai Motor, has an offline auction center in Bundang, Gyeonggi, where many foreign buyers head to bid for used cars.
The company also operates two auction markets: one in Sihwa, Gyeonggi, and another in Yangsan, South Gyeongsang.
But the biggest foreign buyer in terms of total value is Russia, where motorists treasure the Hyundai Starex minivan.
Last year, the country imported 29,753 used Korean cars worth $409 million.
“Four-wheel drive SUVs are popular there due to the cold weather,” said Yi Ki-young, a director at the Korea Used Car Export Association.
“Now Russia is buying over 4,000 used cars each month. Exports to Libya are also doing well.”
Meanwhile, city cars like Kia Motors’ Morning are well-received in Vietnam, according to SK Encar.
The second-largest buyer is Jordan. Even though it ranked second in terms of the value of used cars purchased, the Middle Eastern country was the biggest buyer in terms of the number of units, snapping up 92,450 in 2011 to account for around one-third of those exported.
It has topped other countries for four consecutive years. Many of the vehicles delivered to Jordan are sold on to neighboring countries and regions such as Saudi Arabia, Iraq, Libya and Palestine.
According to the Korea Trade-Investment Promotion Agency, new and used Korean cars command a whopping 60 percent of the auto market in that country. Jordan’s middle class prefers Hyundai Motor’s Avante compact and Accent subcompact sedan.
“Domestic cars have a high rate of fuel efficiency and are competitively priced, which is why they are popular in Jordan,” a Kotra spokesman said.
Jordan is likely to continue to purchase used Korean cars in the future. According to Kotra, over 3,000 Jordanian buyers visited the country last year to purchase used cars.
Seventy percent of them said they would buy more used cars from Korea.
“With growing exports of used cars to Jordan, the delivery of automotive parts such as tires and batteries is also rising,” said Cho Ki-chang, head of Kotra’s Jordan office.
By Limb Jae-un [firstname.lastname@example.org]
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