Korean carmakers to give Japanese market another shot

Korean carmakers will re-enter the Japanese market.

According to GM Korea on Tuesday, GM Japan will sell GM Korea’s new passenger car Chevrolet Aveo from Saturday. For the first time since Hyundai Motor withdrew from Japan in 2009 due to sluggish sales, Korean passenger cars excluding sport utility vehicles and commercial vehicles will try again in the Japanese market.

Car industry observers are keen to see how GM Korea performs in Japan since the Japanese market is dominated by the country`s Big Three -- Toyota, Nissan and Honda -- and European carmakers.

Between June and October this year, GM Korea exported to Japan 311 units of its SUV Chevrolet Captiva produced in its Bupyeong plant. Last month, 195 Aveos were exported to Japan for an aggressive launch from Saturday.

Following the sale of the U.S. Chevrolet sports car brands Camaro and Corvette, GM Japan plans to anchor the Chevrolet brand in Japan through its Korean counterpart. Aveo will be sold in Japan under the name Sonic, and is a hatchback model with a 1.6-liter engine.

The Sonic will go for 1.89 million to 1.98 million yen (24,316 to 25,478 U.S. dollars), or double the sales price in Korea, which is between 12.9 million (11,438 dollars) and 15.59 million won (13,932 dollars).

According to the Japan Automobile Importers Association, 729 Chevrolet cars were sold in the first 10 months of this year in Japan, up 25.7 percent year-on-year. This is a minimal performance given that 20,000 imported cars are sold monthly in Japan.

Imported cars account for about 10 percent of the Japanese car market, but the figure would be just 8 percent if cars imported after being manufactured in Japan’s overseas plants are included.

Due to this reverse import, Korean carmakers have repeatedly failed to make a mark in Japan. For Hyundai Motor, which enjoys booming sales across the globe, Japan remains a challenge. After establishing a sales subsidiary in Japan in 2000, Hyundai marketed its Avante, Sonata and Grandeur models but sold just 15,000 of them until 2009. It has since virtually pulled out its passenger car business from Japan, though it sells a small number of large buses and commercial fleets there.

In 2004 and 2005, GM Daewoo exported its Lacetti and Matiz models to Japan under the Suzuki brand of Japan, but sold just 1,400 units. In 2009, Renault Samsung began selling its SUV QM5 in Japan, but monthly sales reached just 10 units.

gene@donga.com