New car sales in South Korea remained lacklustre despite an initiative by the government to boost sluggish demand in the domestic market. The country’s five vehicle manufacturers together posted sales of 673,426 vehicles, up marginally by 0.3%, thanks to the export segment.
The government of South Korea cut consumption tax on cars by 1.5% starting on 18 September, Dow Jones Newswires reports. Vehicle manufacturers too have offered various incentives.
Despite all this, total domestic sales recorded by Hyundai, Kia, General Motors Korea, Renault Samsung and Ssangyong Motor declined by 6.6% compared with September 2011. This was only marginally offset by a 1.9% increase in their export sales.
“We expect lower taxes and incentives to help buoy sales in the fourth quarter. But the continuing European debt problems and tougher competition will remain the biggest worries at the same time,” Hyundai has said in a statement.
The country’s largest car manufacturer, Hyundai, reported a 2.5% increase in its sales in the domestic market to 57,559 units last month. The company’s overseas sales, comprising both exports and sales from its overseas plants, rose 3.6% to 314,184 units.
Kia’s domestic sales, on the other hand, fell 7% year-on-year to 39,030 units. The company recorded a 2.5% increase in its overseas sales to 175,382 cars, Dow Jones Newswires said, citing company data.
Renault’s South Korean subsidiary Renault Samsung performed the worst of the five local OEMs in September. The company’s sales in South Korea plummeted 64% year-on-year, while exports fell by a massive 40% compared with September 2011 levels. The OEM’s poor performance last month has been attributed to a lack of new models.
