South Korea placed in top five in vehicle production last year for the first time since 2016.
According to the Korea Automobile Manufacturers Association (KAMA) on Monday, global vehicle production hit 78,289,796 units last year and fell 15.5% compared to 2019. China, the United States, Japan, Germany, South Korea, India, Mexico, Spain, Brazil, and Russia ranked first to tenth respectively in vehicle production and all of them experienced a decline in vehicle production. Production in China fell by 2.0% while the United States, Japan, and Germany experienced a 19.0%, 16.7%, and 24.7% decline respectively.
While South Korea also experienced a 11.2% decline, its decline was relatively small compared to other countries and bumped the country from seventh place in 2019 to fifth place in 2020. India and Mexico experienced a 24.9% and 21.2% decline respectively and saw their rankings slip by one place. Russia experienced a 15.7% decline and was ranked in the top ten for the first time since 2000.
China was able to quickly recover from the COVID-19 crisis and stopped its vehicle production from going down below 2%. As a result, its share in global production jumped from 27.8% in 2019 to 32.2% in 2020. Production and sales of electric vehicles also jumped 7.5% and 10.9% respectively.
While South Korea’s exports fell 21.4%, domestic sales of domestic cars increased by 4.7% due to strong domestic demands. This resulted in a decline in vehicle production lower than that of global production at 15.5% and helped the country place in fifth place and increased the country’s share in global production by 0.2%.
The KAMA saw setbacks in production in India and Mexico due to the COVID-19 crisis, cooperation between labor and management within Hyundai Motor Company and other automakers, and a rapid change in the global automotive industry’s structure towards high-value products such as SUV, luxury vehicle, and electric vehicle as possible reasons to a decline in global vehicle production.
“Although it is a huge success for South Korea to be placed in fifth place despite many difficulties, it is necessary for South Korean automakers to put in more efforts in high-value products considering changes in the global auto market such as rapid progress by China’s automotive industry.” said Chairman Jung Man-ki of KAMA. “The South Korean government needs to continue to provide support for bold regulatory reformation and research and development while shareholders, management, and workers must work together and continue to accumulate experiences in working together.”
Staff Reporter Park, Taejoon | gaius@etnews.com