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04. August 2011

South Korean auto sales up by almost 10pct YoY in July

South Korea's five automakers, led by Hyundai Motor Co, said that their sales increased 9.9% YoY in July 2011 thanks mainly to overall gains in demand at home and abroad.

Their combined sales came to 626,060 units in July 2011 as compared with the 570,062 vehicles a year earlier. Sales in overseas markets gained 10.9% YoY to 498,823 units in July 2011 while domestic shipments rose by 6.2% YoY to 127,237 units.

July's on year growth rate, however, was much lower than June's 14.6% surge. Overseas sales include cars exported from South Korea and vehicles made in foreign assembly plants.

The four others are Hyundai's affiliate Kia Motors Corporation, GM Korea Co, the South Korean unit of the world's leading automaker General Motors, Renault Samsung Motors Co, the local unit of French automaker Renault SA and Ssangyong Motor Co.

In the first 7 months of 2011, the carmakers sold 4.41 million vehicles at home and abroad, up by 14.1% YoY.

Industry watchers said the July 2011 sales gain reflects positive market reactions to new models as well as the overall improvement in quality, style and brand image of South Korean vehicles.

The monthly drop was due to labor management wage negotiations at companies such as Kia, and the temporary halting of the assembly lines by GM Korea so it can produce new cars.

Carmakers, however, said that demand will likely pick up in the coming months, fueling domestic and overseas shipments. Hyundai said that its new car models fared well with sales expected to increase steadily in the coming months.

The carmaker, whose sales rose 9.8% to 323,637 units in July 2011, said every effort is being made to meet global market trends, such as demand for hybrid cars, to ensure solid growth. This view was echoed by Kia and GM Korea that said sales should likely grow in the future as labor related issues and updating facilities have largely been concluded.

Mr Ankush Arora, GM Korea's vice president for vehicle sales, said that "The success of the hatchback Cruze compact and the LPGi Orlando are all expected to help sustain sales growth."

Kia's sales rose by 15.2% YoY to 206,600 vehicles in July 2011 with shipments of GM Korea, which makes cars under the Chevrolet brand, dipping 1% to 66,553 units.

Renault Samsung said that though its sales dropped 12.7% to 18,507 vehicles, it expects conditions to improve once the SM7 luxury sedan reaches the market in mid August 2011.

The carmaker claimed that "The SM7 will open a new paradigm for sedans that can boost sales."

Ssangyong, the country's smallest carmaker said that July records showed the company's potential for growth. The carmaker sold a record 10,763 units in July 2011, up by 46.1% YoY. With the restart of sales to China this month, sales should pick up the pace in the coming months.



Sourced from www.yonhapnews.co.kr

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