New car sales in Korea up 17 percent year-on-year in January

Thursday, June 10, 2021

New car sales in South Korea rose by double digits in January due to extended tax benefits and new models with environmentally friendly engines. The growth is a source of optimism for the Asian country’s auto industry, with many manufacturers hoping for an early recovery after the end of the Covid 19 pandemic. According to the Korean Association of Automobile Manufacturers, a total of 116,550 vehicles were sold in South Korea in January, up 16.6 percent from the same month last year and just as the novel coronavirus was becoming a global pandemic. Current sales are mainly composed of eco-friendly vehicles and SUVs.

Sales of eco-cars increased by more than 82 percent year-on-year as manufacturers launched several new models. Among them were the new hybrid versions of the Hyundai Grandeur, Hyundai Tucson and Kia Sorento. More than 10 percent of all vehicles sold in January were eco-cars. Sales of hybrid-powered vehicles were up 94 percent while electric cars were down 62 percent. This is attributed to an as yet unapproved Korean government subsidy for electric vehicles. Cars with fuel cells gained 75.3 percent, led by the Hyundai Nexo with 140 vehicles sold. All automakers except Renault Samsung Motors Co. reported dramatic increases in domestic sales.

South Korea’s largest automaker, Hyundai Motor Co. reported a 25 percent increase in its sales figures. This was largely contributed by their popular SUV models such as Tucson, Santa Fe and Palisade, as well as the Grandeur and Genesis sedans. Kia Corporation recorded a 12 percent increase due to the rising popularity of its Carnival and Sorento models. Improved production conditions following an agreement with the relevant union in December 2020 also contributed to the better sales figures. Exports of new vehicles are also well on the way to recovery. Exports of new cars from Korea rose 29.5 percent in January from a year earlier. Turnover rose 40.2 percent due to increasing demand for high-end vehicles from South Korea.

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