"South Korea Autos Report Q2 2015" is now available at Fast Market Research
New Transportation research report from Business Monitor International is now available from Fast Market Research
[USPRwire, Tue Mar 10 2015] Sales
According to the Korea Automobile Manufacturers Association, domestic auto sales declined 0.2% year-on-year (y-o-y) in October 2014 to 122,247 units. This brought sales for the first 10 months of 2014 to 1,181,225 units, an increase of 2.9% y-o-y and in line with our full-year growth forecast of 3.2%. In 2015, we forecast sales to grow 2.7% as steady growth in private consumption bolsters demand for consumer durables.
Strikes Fuel Long-Term Production Woes
On the production side, plant workers at Hyundai and Kia held their first strike of 2014 in August, demanding higher wages and improvements in working conditions. Similar strikes in previous years resulted in output declines of 16.1% y-o-y and 25.9% y-o-y in 2012 and 2013 respectively, during the months of August and September ( see 'New Labour Dispute Adds To Hyundai's Woes', April 23 2013).
While strikes have not appeared to derail growth in South Korean auto production, we believe these are worrying trends that will add to the already high labour costs for automakers. In March 2014, Hyundai announced that it will build its fourth plant in China, bringing the carmaker's total capacity in the country to 2.3mn a year (beginning 2016) from the 2mn in 2014. We foresee more automakers with domestic manufacturing bases cutting down on production in South Korea and instead pursuing localisation in growing markets such as China to maintain price competitiveness.
We believe that concerns over Hyundai's payment of KRW10trn (USD10bn) for a plot of land in the Gangnam district for the purpose of building a global business centre - which has raised doubts about the company's corporate governance - are likely overblown. Meanwhile, employees of Hyundai have also held strikes in September 2014, as talks with management over employment contracts broke down, with workers blaming the disruption in wage discussions on the land purchase.
The South Korea Autos Report features the latest data and forecasts covering production, sales, imports and exports.
BMI Research's South Korea Autos Report provides industry professionals and strategists, corporate analysts, auto associations, government departments and regulatory bodies with independent forecasts and competitive intelligence on the automotives market in South Korea.
Key Benefits
* Benchmark BMI's independent automotives industry forecasts on South Korea to test other views - a key input for successful budgetary and planning in the Korean automotives market.
* Target business opportunities and risks in the Korean automotives sector through our reviews of latest industry trends, regulatory changes and major deals, projects and investments in South Korea.
* Assess the activities and market position of your competitors, partners and clients via our Competitive Landscape Analysis.
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