This file photo taken April 19, 2023, shows Hyundai Motor Co.’s KONA electric subcompact SUV on display during the 2030 World IT Show in Seoul. (Yonhap)
SEOUL, June 15 (Korea Bizwire) — South Korea’s car exports soared nearly 50 percent on-year in May driven by vibrant demand for eco-friendly cars, particularly in the U.S. market, the industry ministry said Thursday.
The value of outbound shipments of automobiles came to US$6.2 billion last month, up 49.4 percent from a year earlier to reach the highest monthly figure for any May, according to the data from the Ministry of Trade, Industry and Energy.
The monthly car exports surpassed the $6 billion mark for the first time in March and have stayed above the level since then.
In terms of volume, exports jumped 37.5 percent on-year to 248,755 vehicles, the data showed.
The brisk car sales were attributable to strong global demand for eco-friendly vehicles.
The export value of eco-friendly cars surged 64.3 percent on-year in May to $2.1 billion. In terms of volume, sales advanced 49.2 percent to 66,264 units last month.
Of the total, sales of electric and hydrogen models nearly doubled on-year to $1.18 billion, those of hybrid models went up 44.5 percent to $700 million, and exports of hybrid models rose 11.1 percent to $230 million, the data showed.
“The brisk sales came as South Korean commercial vehicles are entitled to enjoy a tax benefit under the U.S.’ Inflation Reduction Act regardless of other conditions, and the proportion of sales of commercial vehicles jumped to about 40 percent in May from 5 percent last year,” the ministry said in a release.
The IRA offers tax credits of up to US$7,500 to each buyer of a new electric vehicle (EV) assembled in North America and with batteries made of a certain amount of critical minerals produced in the region, but those conditions do not apply to commercial vehicles.
North America was the No. 1 export destination for South Korean cars last month, with sales jumping 52.2 percent on-year to $2.91 billion in May.
Shipments to the European Union surged 77.1 percent to $1.15 billion, and those to Asian nations skyrocketed 86.6 percent to $579 million. Exports to the Middle East went up 30.8 percent to $503 million.
Of the major firms, exports by Hyundai Motor Co. and its affiliate Kia Corp. grew 17.7 percent and 28.1 percent on-year last month, respectively, the data showed.
Domestic production rose 24.5 percent on-year to 382,000 units in May on the back of the smooth supply of automotive semiconductors, contributing to the solid exports.
During the first five months of the year, 1.82 million vehicles were produced, recovering to the pre-COVID-19 pandemic level, according to the ministry.
Exports of auto parts, however, inched down 0.7 percent on-year to $1.94 billion.
At home, sales of automobiles went up 4.6 percent on-year to 152,190 units in May.
Of them, sales of domestic models grew 8.7 percent on-year to 131,000 units, while foreign brands saw their sales in South Korea fall 14.7 percent from a year earlier.
A total of 47,000 eco-friendly cars, including EVs, were sold at home, accounting for 31.1 percent of the total vehicles sold in May, the data showed.
(Yonhap)
