With Korean cars, a year is just a state of mind
Yoon was trying to sell his car, a 2010 model. But when the dealer checked the car’s registration, he found the car was actually made in 2009. Yoon couldn’t believe it.
“I firmly believed that the car I bought was produced in 2010,” Yoon said. “But according to the registration number, my car was manufactured the year before.”
Ms. Choi, also an office worker, bought a 2016 model car last May. She wondered whether she should have waited when she learned the 2017 model was launched last month - when it was still 2016.
“Had I known the 2017 version would be on sale only five months later, I definitely would’ve waited,” Choi said.
Yoon and Choi are victims of the Korean automotive industry’s looseness with model years.
In the past, carmakers have frequently launched new models in the closing months of the previous year, usually in November or December. But this year, with fiercer competition and the ending of a special break on the consumption tax in June, carmakers have launched 2017 models as early as April.
Hyundai Motor unveiled the 2017 model of its flagship midsize Sonata sedan in April. New safety and design options were added.
Analysts say early releases acknowledge rising competition in the midsize sedan sector, with GM Korea releasing a new Malibu and Renault Samsung a new SM6 this year.
The April launch was designed to attract buyers before the end of June, when the consumption tax cut ended.
In June, Kia Motors released its 2017 midsize K5 sedan with an updated trim and transmission.
GM Korea also released a new Spark, its compact model, in June and started accepting pre-orders for its 2017 Malibu in September, only five months after it unveiled the 2016 version in April.
Before 2000, there were regulations requiring car makers to label vehicles with a model year identical to when they were manufactured. In 2000, the regulation was updated to allow car makers to release a new model a month before the year changed. In 2003, the one-month period was expanded to half a year, meaning car makers could launch next year’s version as early as July.
In 2005, the regulation was once again eased, allowing car makers to launch a new model at any time as long as the car was made within two years of its model year.
Carmakers roll out new model years to create a new-car effect. A new model leads consumers to think the car will be improved. If the sales of the previous model starts to dwindle, the easiest way to regain momentum is to release a new model.
It’s also the best way to increase the sticker price on a model.
Carmakers say most customers understand new model years released months before New Year’s Day. And that they want updates and changes in a model even if they aren’t very big.
Critics say it dupes some customers, and also causes confusion in the secondhand car industry, where prices depend a lot on the year of manufacture.
“It is understandable that car companies make such decisions to survive in the competitive auto industry these days,” said Lee Ho-keun, a professor who teaches automotive engineering at Daeduk College.
“But relying too much on that two-year grace period can degrade confidence among customers in a car company.”
BY LEE DONG-HYUN, JIN EUN-SOO [firstname.lastname@example.org]
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