Auto exports down nearly 6 pc in S. Korea on supply disruptions
Seoul, June 17
South Korea's auto exports decreased nearly 6 per cent in May from a year earlier, data showed on Wednesday, amid disruptions in the supply of auto parts following a fire at a local factory.
The combined value of automobile exports came to US$5.83 billion last month, down 5.9 percent from the same month last year, according to data from the Ministry of Trade, Industry and Resources, reports Yonhap news agency.
Outbound shipments to North America, Latin America and the European Union fell 1 percent, 3.6 percent and 6.5 percent, respectively. Those to the Middle East dropped 4.2 percent.
Exports to Oceania and Africa, on the other hand, shot up 20.1 percent and 16.1 percent, respectively.
The ministry said exports of eco-friendly automobiles maintained solid growth, expanding 9.9 percent on-year to $2.4 billion.
Domestically, 127,315 vehicles were sold last month, down 10.3 percent. Sales of locally manufactured cars fell 14.2 percent to 96,240, while those of imported cars rose 4.8 percent to 31,075.
The data also showed that domestic automobile production contracted 8.2 percent on-year to 329,559 units.
Production at Hyundai Motor Co. and Kia Corp. decreased 12 percent and 2 percent, respectively.
Production at GM Korea Co., the South Korean unit of General Motors Co.; KG Mobility Corp.; and Renault Korea Motors Co. fell 6.6 percent, 8 percent and 46.5 percent on-year, respectively, in May.
"As the May figures reflect the fallout from a fire at an auto parts factory that led to manufacturing disruptions, production and exports are expected to gradually improve starting in June as supplies normalise," the ministry said.
Meanwhile, Seoul stocks opened lower on Wednesday, partly driven by investors pulling out of stocks related to artificial intelligence (AI) in the U.S. market.
The benchmark Korea Composite Stock Price Index (KOSPI) was down 75.79 points, or 0.87 percent, to 8,650.81, as of 9:15 a.m.
The index followed declines on Wall Street overnight, where a tech sell-off knocked down the S&P500 by some 0.5 percent and the Nasdaq by 1.15 percent.
Nvidia surprised investors with a plan to issue US$25 billion worth of bonds, which marked the chip giant's first bond sale in five years. Its shares fell 2.4 percent.
Investors were also cautious ahead of the Federal Reserve's policy update due Wednesday (U.S. time) afternoon, with some concerned that the new Fed chair could signal a more hawkish tone in this first meeting.
— IANS
Reader Comments
The eco-friendly vehicle segment still growing at almost 10% is promising. India should take note - our EV policies need more consistency. Korean brands like Hyundai and Kia are making strides globally, but this fire setback shows even giants stumble. Government intervention is key.
Dekho yaar, sales of imported cars in Korea went UP while domestic fell? That's a signal - maybe Korean consumers prefer foreign brands when local supply is shaky. In India, we see same trend with luxury imports. But our domestic manufacturers should learn from this - quality and consistency matter.
The stock market drop due to AI fears is a separate but interesting angle. Nvidia's bond issue making waves even in Seoul shows how interconnected global finance is. India's markets also feel these ripples. But honestly, the auto parts factory fire causing these numbers is just unfortunate timing.
Exports to Africa and Oceania growing by 20% and 16% is impressive! Shows Korean automakers are diversifying markets. India should partner more with Korea in Africa - our shared experience in developing markets could be powerful. But first, Korea needs to sort out this supply issue.
As someone who drives a Hyundai i10, I feel this personally 😅 Korean cars are huge in India. This supply disruption might mean longer waiting periods or price hikes here too. The ministry's optimism about recovery by June is comforting, but we've seen how such disruptions can linger.
We welcome thoughtful discussions from our readers. Please keep comments respectful and on-topic.