Nine Korean auto parts makers make the Top 100 list

Nine Korean companies made it on the list of the top 100 auto parts companies compiled by U.S.-based Automotive News, based on their 2020 revenues.

In 2019, eight Korean companies were listed.

Yura Corporation, a Pangyo-based electronics parts manufacturer for automobiles, was a newcomer to the list and it landed in the 78th spot.

Hyundai Mobis which was at the top among Korean companies came in at seventh spot, with Hyundai Transys, Hyundai Wia, Hanon Systems, Mando and SL following.

Korea was fourth in terms of the number of companies on the list.

Japan came in first with 23 followed by United States with 22 and Germany with 18. China came in fifth with eight.

“Korean auto parts companies managed to perform relatively well in 2020 thanks to the domestic auto industry, which hit all-time record sales focused on SUVs and electric vehicles,” said the Korea Automobile Manufacturers Association (KAMA) in a report Wednesday analyzing the Automotive News list.

The combined sales of Korean companies on the 2020 list shrunk by 3 percent compared to 2019, the report said, while sales of Japanese parts makers and German parts makers shrunk by 8.2 percent and 8.6 percent.

China was the only country that experienced a growth in sales between 2019 and 2020. Combined sales of Chinese auto parts makers included in the 2020 top 100 list were 6.9 percent more than in 2019.

The KAMA report said Korean auto parts makers fell behind in terms of investment in research and development (R&D).

The nine Korean auto parts makers spent an average of 3 percent of revenues on R&D while the five top companies – Bosch, Denso, ZF, Magna and Aisin – spent an average of 7 percent.

Bosch, especially, which posted a net loss in 2020, managed to spend 10.5 percent of its revenue on R&D.

Hyundai Mobis spent 2.8 percent and Hyundai Transys 3.1 percent. Hanon Systems, which makes electric vehicle parts, spent 4.9 percent.

“Preemptive investment in R&D is essential when the paradigm is shifting to electric and self-driving cars,” said Jung Man-ki, chairman of KAMA.

“The Korean government should provide more incentives to encourage investment such as giving tax credits when building R&D facilities.”

BY JIN EUN-SOO [jin.eunsoo@joongang.co.kr]