LCCs holding promotions for cheap tickets

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LCCs holding promotions for cheap tickets

Korea’s trade surplus in automobiles fell last year due to rising demand for foreign-made cars and local automakers expanding overseas production, Korea Customs Service (KCS) said in a report on Tuesday.

According to the customs agency, the total export value of Korean cars was $43.9 billion last year, up 1.6 percent from a year earlier, while the value of imports hit $7.97 billion which is a 45.4 percent increase from a year ago. As a result, the country’s trade surplus decreased 4.8 percent year-on-year to $35.98 billion in 2014.

The KCS report also showed that the average price per unit of cars shipped abroad was $14,316 last year, which is just 1.6 percent higher than in 2013, while the average unit price of imports was $31,144, up 4.5 percent year-on-year.

By country, the United States was the largest buyer of Korean cars, accounting for more than 85 percent of exports, followed by the United Kingdom, Australia and Mexico. For imports, Koreans preferred German cars, which accounted for more than 81 percent of cars brought in to the country, followed by vehicles from Japan and the United Kingdom.

In terms of car size, exports of city cars, which have an engine displacement of 1,000cc or less, decreased 15.3 percent year-on-year, but gasoline cars with engine displacement of between 1,000cc and 1,500cc increased 6.2 year-on-year. Cars with an engine displacement of more than 2,000cc increased 6.3 percent year-on-year.

The import value of gasoline cars with an engine displacement between 1,000cc and 1,500cc increased by more than 600 percent last year over 2013, while imports of diesel cars of that size were up 1,500 percent. This shows that there was huge demand for small foreign-made vehicles. Imports of large diesel cars with an engine capacity over 2,000cc also increased, by 64 percent year-on-year.

Recent data from the Korea Automobile Importers and Exporters Association reflected the same trend as the customs report, with 196,359 new foreign cars sold in Korea last year, up 25.5 percent from 2013.

“As the growth of imports is larger than the growth of Korean car exports, the trade surplus last year dropped,” the customs agency said. “The result was also due to Korean automakers increasing overseas production of parts, then exporting the cars from home turf.”

Data from Korea’s largest automaker Hyundai Motor showed that its vehicle shipment from Korea increased by just 1.3 percent year-on-year in 2014, but sales of cars manufactured at overseas plant increased 5.9 percent over the same period.

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