The New GV70 (Image courtesy of Genesis)
SEOUL, May 13 (Korea Bizwire) – Within Hyundai Motor Company, there is a growing perception that Audi customers are starting to buy Genesis models, according to industry sources on May 12.
This assessment is backed by more than just surface-level sales figures. Some imported car brands, unable to withstand the Genesis onslaught, are downsizing operations in the domestic market by withdrawing or closing showrooms.
According to the Korea Automobile Importers and Distributors Association (KAIDA), imported car sales from January to April fell 7.8% year-over-year to 76,143 units. In contrast, Genesis brand sales rose 6% over the same period to 45,554 units. The sales gap between imported cars and Genesis has narrowed from around 40,000 units a year ago to the 30,000 range.
While the imported car market saw rapid growth in the 2010s, its momentum has recently stalled. The imported passenger car market share, which first exceeded 20% (20.1%) in 2022, dipped to 17.7% as of April this year. Aside from Japanese brands benefiting from a hybrid car-driven resurgence, most imported carmakers are experiencing sharp sales declines.
The overall domestic auto market contraction, compounded by the strong U.S. dollar, has exacerbated challenges for imported car operations. Some importers are cost-cutting by reducing dealerships.
Notably, Stellantis decided to discontinue sales of its French DS Automobiles brand in South Korea this year after selling just 153 units in 2023 – a performance too dismal to justify maintaining the brand’s presence.
As of September last year, Audi had 12 showrooms in Seoul but has since trimmed that to nine locations. Audi’s sales have plunged 74.7% so far this year due to supply shortages. Ford, whose 2023 sales fell 20.4%, also consolidated its Seoul showrooms from nine to six.
Industry watchers caution that if import brands remain stuck in their past rapid growth mindset without new strategies, they risk ceding further market share to Genesis. Brands prioritizing the Korean market are increasing investments, as it has become a major sales hub – ranking second globally for Mercedes-Benz’s ultra-luxury Maybach brand and third for BMW’s 7 Series sedans.
Last month, BMW opened its Group R&D Center Korea in Incheon’s Seo District. British sports car maker Lotus, acquired by Geely, is re-entering the Korean market after nearly a decade with the upcoming delivery of its high-performance Eletre electric vehicle in September.
Kevin Lee (kevinlee@koreabizwire.com)
