Semiconductor Supply Shortage Crisis Impacts Export Volume Decline
Electric and High-Value Vehicle Exports Drive Value Increase

In May, vehicle export volume decreased 2.5% year-on-year, but vehicle export value increased 18.9%.

Due to tight automotive semiconductor supply, production disruptions resulted in lower export volumes. However, strong exports of high-value-added vehicles including SUVs and electric vehicles drove the increase in export value.

May overseas sales of five domestic complete vehicle manufacturers (Hyundai, Kia, Renault Korea, GM Korea, SsangYong) totaled 471,359 units, representing a 2.5% decrease compared to the same month last year.

Hyundai Motor's May overseas sales volume was 260,666 units, down 1.1% year-on-year. A Hyundai official stated, "While management uncertainty continues due to semiconductor component supply disruptions, we will minimize the impact of supply delays through flexible semiconductor allocation and vehicle production schedule adjustments," expressing difficulties amid the semiconductor shortage.

Kia also failed to reverse the sales decline trend. Kia's May overseas sales volume was 188,891 units, down 5% year-on-year. A Kia official stated, "We will expand market share and profitability through competitively strong new model launches and substantive sales strategies."

Renault Korea's May exports were recorded at 4,863 units. This represents a 14.9% decrease compared to the same month last year. The production of Renault Korea's flagship model QM6 encountered component supply difficulties, cited as a major reason. The QM6 sold 1,248 units in the global market including Korea, a 59.5% decrease year-on-year.

GM Korea's May export volume was 12,932 units, up 9.3% year-on-year. The Trailblazer and Buick Encore GX led the increase with 6,471 units exported. Carlos Mineurt, Vice President of GM Korea, stated, "We face difficulties due to prolonged automotive semiconductor chip supply issues and resulting production disruptions," adding "We will expand our portfolio alongside a strengthened SUV lineup."

SsangYong exported 4,007 units, down 6% year-on-year. Export volumes that had shown growth in March, surpassing 3,000 units, recorded over 4,000 units in May, with prospects that more exports could be achieved if component supply constraints are resolved. SsangYong stated, "We will ensure smooth parts supply and increase sales volumes."

While export volume decreased, export value increased.

According to the May 2022 export-import trends announced by the Ministry of Industry, automobile exports reached 4.153 billion dollars, up 18.9% year-on-year.

In addition to the base effect from May last year when production disruptions from automotive semiconductor supply shortages became full-blown, the increase over two consecutive months is attributed to expanded exports of high-value-added vehicles such as electric vehicles.

Efforts by Korean companies to shift export channels amid declining exports to CIS markets following the Ukraine crisis, along with strong performance of SUVs and eco-friendly vehicles, are cited as additional reasons.

As the Ukraine war prolonged, automobile sales in CIS regions recorded 120 million dollars, a 45.8% decrease year-on-year. New car sales rates have declined following Russian sanctions. In contrast, the Middle East saw increased demand for rental cars and new/used vehicles, recording 250 million dollars, up 86.2% year-on-year.