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Auto Exports in Korea to Hit US $ 43 billion in 2006
May 03, 2007

Korean auto exports to reach new heights in 2006 as Auto & auto part exports will reach US $ 43 billion in 2006, accounting for 13 % of Korea's overall exports.

Auto & auto part exports will reach US $ 43 billion in 2006, accounting for 13 % of Korea's overall exports, estimated to reach US $ 326 in 2006, as per KAMA (Korea Automobile Manufacturers Association) on December 8 2006.

Automobiles are the leading export item in Korea since 2001, the time when leading automakers began to recover their sales after witnessing financial crisis in 1997-98. Auto exports, by volume, are estimated to reach new heights at nearly 2.7 million units in 2006. Last year, Korean auto & auto part exports were at US $ 38 billion.

Korea, the fifth largest car manufacturer in the world following US, Japan, Germany & France, has witnessed speedy growth in last few years, fueled by positive economic growth & rising wealth. The country still has a relatively low car ownership level compared to its developed OECD (Organization for Economic Cooperation and Development) peers, suggesting a lot of potential for expansion in the industry in future. Govt. policies like tax-breaks on purchase of new cars have helped the industry to grow.

Since 1997's crisis, the industry has seen many changes. Initial consolidation resulted in mergers of debt-ridden firms with their competitors. Further, consolidation saw merger of domestic automakers with foreign carmakers that helped the industry to recover steadily from the crisis.

The Korean auto industry is highly export oriented with majority of exports going to EU & US though China is also becoming a highly important export market for Korea

An analyst at
RNCOS said, "Medium-term outlook for auto exports in Korea looks bright. Domestic carmakers have enhanced their brand profile & reliability and Korean cars are now considered as good alternatives to Japanese ones in the market. Though export value is quite small compared to that of US, but the nation can take advantage of increasing demand from China, mainly due to Korea's proximity to the country."

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