Just after June, the Korean car’s plunge pattern continued. On July 5, Reuters quoted Hi Investment Securities Analysis Company as saying that South Korean automaker Hyundai Motor sold only 35,049 vehicles in China in June, down 64% from the same period last year. Kia Motors' sales in China dropped 58%. It fell to 1,903 vehicles.
This is the sixth consecutive month that Hyundai Kia Group has fallen in China this year. In the first five months of this year, Hyundai and Kia’s cumulative sales in China were only 377,000 units, down 43% year-on-year, and the sales completion rate was less than 20% of the annual target.
Hyundai Kia’s two joint ventures in Beijing, Beijing Hyundai and Dongfeng Yueda Kia, suddenly lost their sales this year. In 2016, Beijing Hyundai delivered 1.14 million vehicles in China, with an average monthly sales volume of 80,000 to 100,000 vehicles, which exceeded the target for the whole year.
In June of this year, Beijing Hyundai sold only 301,000 vehicles in China, and the annual sales completion rate was less than 24% of the 1.25 million sales target. According to reports, due to poor sales, Beijing Hyundai's Chongqing plant, which will be completed in August, has no production plan. Just last month, Wu Zhoutao, deputy general manager of Beijing Hyundai and director of the copy of the sales department, said that the annual sales target for this year will be lowered in the near future, and the specific reduction is still in the final confirmation.
The days of modern Beijing dealers are not good enough, and some dealers have closed their doors. In 2015, the number of dealers in Beijing Hyundai in China reached 780, and the number of 2016 vehicles increased by 7.69% year-on-year to 840. However, according to incomplete statistics, in the second quarter of this year, the number of 4S stores in Beijing Hyundai decreased by 13 compared with the same period of last year, accounting for 1.6% of the total number of 4S stores nationwide. The dealers closed their stores mainly in Beijing, Guangzhou, Shanghai and other developed economies. In the first-tier cities, according to dealers, the first-tier cities have great pressure to survive and high operating costs, which is difficult to sustain in the case of poor sales.
Kia is also true in China. Kia’s joint venture in China, Dongfeng Yueda Kia, sold 1.90 million units in June, plummeting 58%. In May, sales volume was 17,400 units, down 65.3%. The previous June sales volume was only 129,700 units, which was less than the beginning of this year. 20% of the annual sales of 700,000 vehicles.
In the first half of the year, Kia has experienced the “anti-water†crisis of dealers. The return of veteran Su Nanyong has temporarily eased this contradiction, but in the case of poor sales, the survival of dealers is still difficult.
Self-owned brands and Japanese cars have clearly become the beneficiaries of the decline in sales of Korean cars. According to statistics released by the China Association of Automobile Manufacturers, in the first five months of this year, the market share of Japanese cars increased from 15% to 17.3%, while the market share of independent brands increased by 1%. It can be seen that the Korean cars that originally beat the car market with high cost performance have been gradually replaced by other brands.
People in the automotive industry generally believe that Korean cars are entering a bottleneck period in China. With the rise of the quality of independent brands, the price of joint-venture brands such as Japanese cars has dropped, and the advantages of Korean cars in China are getting less and less.
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