Seoul sees turnaround in bleak auto industry
The fledgling auto industry was among the hardest-hit sectors during South Korea's recent economic crisis.Skip to next paragraph
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The bottom fell out of the market at home, and Korean sales efforts overseas, which had begun paying dividends, were also annulled.
Both the government and the industry, however, now perceive signs of a turnaround and have affirmed their belief that automobiles will be a big foreign-currency earner for the country in the years ahead.
''The industry had a couple of very bad years,'' a Commerce and Industry Ministry spokesman said. ''Production was pulled down by poor domestic demand, and we exported only 16,200 cars last year, compared with 70,000 in 1978.''
There are no precise predictions for this year, but a definite improvement is certainly expected. The Korean strategy is to consider concentrating on developing new markets in South America, the Middle East, and Asia - rather than trying to batter a way into the United States or Western Europe on the heels of the Japanese.
In South America, Venezuela, Chile, and Ecuador are also considered rather promising at present.
From the industry side, C. K. Shin, vice-president of the Hyundai Corporation , part of the group that makes the best-selling Pony passenger car, says: ''Yes, the domestic market was pretty bad last year, so we made some losses. And although the Pony has been exported to 48 countries, our sales last year only totaled $60 million.
''Still, we regard the motor industry as one of our leading basic industries, and Hyundai certainly has a strong willingness to develop it further.''
Hyundai has an annual production capacity of 200,000 vehicles a year but is operating somewhat below this level even now, as the economy is picking up.
''We are still suffering some losses,'' Mr. Shin says, ''but we are persevering for the overall benefit of the country.''
As a sign of confidence in the future, in fact, Hyundai has signed an agreement with Mitsubishi of Japan to expand production capacity to 300,000 units by 1984.
The auto-parts industry, although still in its infancy, is also being expanded, with infusions of foreign capital and technology, and has begun making a small contribution to the export figures.