Importers not satisfied with 10% of market
BUSAN - Foreign cars already account for almost 10 percent of the local market but importers are hungry for more, with Volkswagen Korea plotting cheaper models and BMW Korea extending its lineup to net more customers.
Volkswagen Korea plans to launch the Passat, its highly successful midsize sedan, in the country in September. It will be competitively priced between 35 million won ($29,660) and 45 million won.
“Passat will directly compete with the Grandeur, Hyundai Motor’s full-size sedan,” Park Dong-hoon, the importer’s managing director, said during the Busan International Motor Show that opened to the press yesterday. The Grandeur retails for between 30.5 million won and 43.5 million won.
The Korea-bound Passat, which measures 486.8 centimeters (191.7 inches) in length, will be manufactured in the United States, unlike its predecessors that were produced in Europe.
Park expressed concern of possible supply shortages, as indicated by the mass following the model has attracted in the U.S. He said the company intends to first ship 3,000 units to Korea, much below expected demand.
Next year, the company will introduce more volume models including its Polo, a subcompact. The launch was postponed due to fears that the smaller model could cannibalize sales of the Golf hatchback.
Meanwhile, BMW Korea plans to offer a wider range of models to meet local customers’ diverse needs. “[We have] an economy of scale and we will bring in more models in the latter half of this year,” CEO Kim Hyo-joon said at the motor show.
The German automaker is exhibiting the highest number of vehicles among foreign brands at the Busan event, which wraps up on June 3. It showcased 17 vehicles including five Korea premiers: the 525d Touring M Sport, X6 M, 640i Gran Coupe, M5 and Active Hybrid5.
Kim was upbeat about the growth of imported car sales.
“Importers are launching more models, while consumer demand is becoming more diverse,” he said.
Yoon Dae-sung, executive managing director of the Korea Automobile Importers and Distributors Association, added that, “Younger customers are buying more imported cars.”
BMW is looking for a site for its test driving center and has now whittled its decision down to three candidates, the company said. It said the new 3 Series and 5 Series sedans are selling well. BMW hopes to shift 33,000 vehicles in total in Korea this year.
Audi Korea is also optimistic about the local market as it saw its sales shoot up 47 percent on-year in the first four months. It hopes to sell 15,000 units in 2012.
Coupled with lowered prices and growing demand for imported cars, foreign models are expected to break the 10 percent mark for the first time in the country later this year.
In the first quarter, they accounted for 10 percent share of the passenger market, according to Korea Automobile Manufacturers Association.
Meanwhile, Ssangyong Motor CEO Lee Yoo-il said the company will buy transmissions from Hyundai Powertech to cut costs. Since October, it has been importing the parts from Australia and Europe.
Ssangyong plans to export 4,000 cars to Brazil, including its Korando C and Rexton SUVs, but it said it will subsequently ship half-finished products due to high import duties.
By Limb Jae-un [email@example.com]
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