South Korea’s automobile industry started in the mid-1950s. At that time, the Korean War had just ended, and it was in a period of economic recovery. There was a lot of waste waiting to be done, and there was a huge demand for various machinery. The demand for automobiles as the main transportation machinery was even more urgent. This realistic demand became the main reason for the development of South Korea's automobile industry. reason. However, the so-called automobile industry at this time only repaired and modified old cars that were eliminated during the Korean War and assembled cars with imported parts.

The real start of South Korea’s automobile industry came after Park Chung-hee came to power and formulated the Automobile Industry Protection Act. Although the development history of South Korea's automobile industry is not long, it is developing rapidly. In 1962, South Korea produced less than 2,000 cars. By 1994, it had produced 2.312 million cars, making it the world's sixth largest car producer. [1]

Before the 1970s, South Korea did not export cars. However, by 1988, the number of cars exported by South Korea reached 576,000, accounting for 53.2% of that year’s car production (1.084 million). In 1994, the number of automobile exports increased to 738,000 units, accounting for 31.9% of that year's automobile production. As a result, South Korea has not only become a major automobile producer, but also the fifth largest automobile exporter in the world, second only to Japan, Germany, France, and the United States.

1. The development history of the Korean automobile industry

The Korean automobile industry has roughly gone through four stages of development.

1. Initial stage (1960s)

The Korean government formulated an automobile industry development plan in April 1962, integrating the scattered automobile industry into the national planned development track. In order to effectively implement the automobile industry development plan, the Korean government formulated the Automobile Industry Protection Act in 1962, which was a signal and declaration for the official development of the automobile industry in Korea. Since then, with the encouragement of the government's preferential policies, South Korea has successively established automobile production companies such as Shinkook, Shinjin, Asia, and Hyundai. Most of these clubs are joint ventures with foreign automobile companies (such as Italy and the United States), and they all use foreign automobile production technology. At the beginning, semi-finished products and parts were mainly imported from abroad, and automobiles were assembled by Korean workers. Despite this, after all, the first step into the Korean automobile industry laid the foundation for the future development of the automobile industry.

2. Localization stage (1970s)

In December 1969, South Korea formulated the "Basic Plan for the Development of the Automobile Industry", proposing to achieve localization of car production in 1972 and 1974. The goal of localizing the production of large cars will be achieved by the year. In the Third Five-Year Plan for Economic Development (1972-1976), which was implemented in 1972, the rectification and development of the automobile industry was also listed as one of the priorities. In early 1973, after President Park Chung-hee issued the "Declaration on Heavy Chemical Industrialization", South Korea listed the automobile industry as one of the "Top Ten Strategic Industries" and provided key support.

In order to promote the development of the automobile industry, South Korea closed, suspended, merged, and transferred some scattered automobile manufacturing companies to form four major automobile production companies: Hyundai, Kia, Asia and Korea General Motors. Mass production system. At this stage, the Korean automobile industry worked hard to develop domestically produced cars, designed its own car types, and developed models... In July 1973, Kia Industrial Co., Ltd. (hereinafter referred to as "Kia") developed the 2000cc automobile engine for the first time in Korea, blowing the whistle. This is the clarion call for South Korean automobiles to officially enter the stage of localization. In 1974, Hyundai Motor Corporation (hereinafter referred to as "Hyundai") manufactured the "Pony" sedan, which was completely designed by itself, making South Korea the 16th country in the world with the ability to independently produce sedans.

In 1976, cars produced by "Hyundai" began to be exported to Ecuador in Latin America, and trucks produced by "Kia" and Korea General Motors were exported to the Middle East, opening the door for Korean cars to enter the international market. a new page. That year, "Hyundai" exported 1,042 cars to 13 countries. In 1979, the South Korean government officially announced automobiles as one of the top ten export commodities. By 1979, South Korea produced more than 200,000 cars and exported more than 30,000 cars.

3. The stage of entering the international market (from the late 1970s to the mid-1980s)

From the late 1970s to the early 1980s, due to the turbulent domestic political situation (President Park Chung-hee announced in October 1979 He was assassinated in May 1980 and the Gwangju People's Uprising broke out in May 1980, etc.), South Korea's economic situation deteriorated, and negative economic growth occurred in 1980. Under this situation, South Korea's automobile industry has also been severely affected, with output declining sharply. In order to revitalize the automobile industry and enter the international market, the Korean government announced the "Automotive Industry Rationalization Measures" in February 1981. The focus was on realizing the professionalization of automobile production and improving the production capacity and efficiency of automobiles through the alliance or merger of automobile production clubs. quality to enhance competitiveness. To this end, the government clearly stipulated that the two automobile companies "Hyundai" and "Daewoo" (the original Shinhan) focus on the production of cars; the two car companies "Kia" and "East Asia" focus on the production of fire trucks and vehicles under 5 tons. Minivans; Asia Automobile Co., Ltd. (hereinafter referred to as "Asia") mainly produces jeeps, etc. Trucks and cars (buses) over 5 tons are freely produced by each automobile club, forming a competitive system. These measures worked. Starting from 1982, as South Korea's economic situation improved, automobile production began to increase rapidly. By 1983, the number reached more than 220,000 vehicles; in 1985, it reached 378,000 vehicles.

When automobile production was developing rapidly, the Korean government began to guide the automobile industry to actively develop new vehicle types and models, improve technical levels, and expand production scale to enhance competitiveness and enter the international market. In 1986, South Korea's automobile sales surged to 592,000 units, accounting for 1.3% of the world's total automobile production, making South Korea the 11th largest automobile producer in the world. That year, South Korea exported 292,000 cars, accounting for 1.9% of the world's car exports, becoming the world's ninth largest car exporter.

4. The stage of moving towards a major automobile production country (mid-1980s to early 1990s)

After the mid-1980s, the Korean government proposed new development goals for the automobile industry, that is, to further Expand production scale, accelerate technology development, increase foreign exports, and strive to make South Korea a major automobile production and export country. For this reason, the Korean government has gradually canceled a series of preferential policies that supported and protected the automobile industry in the past since 1987, and opened up the automobile market. At the same time, there will no longer be restrictions on the types and models of vehicles produced by various automobile manufacturers, in order to encourage competition among automobile production clubs, the survival of the fittest, and promote the development of the automobile industry to a higher level.

Under this situation, various automobile manufacturers in South Korea are rushing to take various measures to develop new car types and models. "Hyundai" began to produce higher-end Pony brand cars, "Daewoo" started to develop Lymans brand luxury cars, and "Kia" started to develop multi-seater Besta brand cars. At the same time, various automobile manufacturers are competing to enter the international market. After entering Latin America and Southeast Asia, it entered the Canadian and American markets in North America, then entered the European market, and later even squeezed into the Japanese market. Currently, Korean cars have been exported to more than 190 countries and regions around the world. It can be said that Korean cars are all over the world today.

As mentioned above, the development of South Korea's automobile industry has gone through four stages, and has encountered different problems and difficulties at each stage. It is not only affected by the domestic political and economic situation, but also affected by the international political and economic situation. For example, the two oil shocks in the 1970s (a substantial increase in oil prices) affected the development of the Korean automobile industry. But overall, South Korea's automobile industry is constantly moving forward.

2. Moving towards the future in competition

At present, the output value of South Korea's automobile industry accounts for about 10% of South Korea's manufacturing industry, and automobile exports account for about 6% of total exports. The automobile industry It has become one of the pillar industries of South Korea's manufacturing industry.

In the early 1990s, South Korea planned to achieve annual automobile production of 3.2 million vehicles by 2000, with domestic sales of 2 million vehicles and exports of 1.2 million vehicles, thus becoming the world's fifth largest automobile producer. Now, some parts of this goal have been achieved, and some parts will definitely be achieved in advance. In order to promote the further development of the automobile industry, the Korean government and various automobile clubs are actively taking various effective measures.

First, increase investment and promote technology development.

In South Korea, US$35 billion has been invested in the automobile industry so far.

In order to continue the development of the automobile industry, the Korean government has explicitly ordered automobile manufacturers to use 5% of sales as technology development funds and independently produce Korean-specific high-end cars for the international market. At the same time, we must devote ourselves to the development of automation technology and the development of alternative energy vehicles such as pollution-free engines, CNG vehicles and alcohol-powered vehicles. It also requires the establishment of 350 enterprise-affiliated research institutes by 1995 to focus on the research and development of automobile parts and independently develop cutting-edge parts, making South Korea a strong and independent automobile country.

"Hyundai" took the lead. After successfully developing front-wheel drive vehicles, it continued to strengthen technology development focusing on new markets. In 1993, "Hyundai"'s technology development expenses accounted for 4% of that year's sales (this year, "Hyundai" sold 966,000 cars, amounting to US$8.89 billion), and plans to develop technology in the next ten years. The fee is increased to 7% of sales for the year.

On the occasion of the 50th anniversary of the establishment of the enterprise group, "Kia" announced that it will carry out three major innovations in technology, management and welfare, with the goal of becoming one of the world's top ten automobile manufacturers by the 21st century. To this end, we have concentrated investment and devoted ourselves to researching five topics including cutting-edge technology and environmental technology. Just like "Hyundai", it announced that it will increase scientific and technological research expenses to 7% of sales, increase the number of technical researchers to 5,000, and ensure that more than two new products are developed every year. Currently, "Kia" is researching and developing technologies to prevent car collisions, drivers from dozing off, and to promptly cut off the fuel delivery line in the event of a car collision. The above technologies have been applied to various models since 1997.

"Daewoo" has now developed cars powered by compressed natural gas to save fuel and reduce pollution. This "natural gas vehicle" independently developed by "Daewoo" has reduced exhaust gas emissions to less than 50% of ordinary gasoline-fueled vehicles, and the price is only 1 million won (approximately US$1,260) more expensive than ordinary vehicles.

SsangYong, the fourth largest automobile manufacturer in South Korea, is introducing cutting-edge technology from German Mercedes-Benz to produce large and medium-sized luxury cars.

At the same time, the South Korean government also strongly supports the development of auto parts production and has decided to invest US$23 billion in technological innovation and additional equipment in auto parts manufacturing plants.

Second, promote competition among automobile manufacturers.

Before the mid-1980s, the Korean government adopted a policy of protection and restriction for the automobile industry, and had strict regulations on the models and types of vehicles produced by each automobile production company. However, since the mid-1980s, this restrictive policy has been gradually replaced by liberalization policies. In 1987, the government abolished vehicle production restrictions; later it allowed the free import of foreign-made cars (except Japanese cars) and lowered import tariffs in stages. By April 1995, Samsung Group, the largest enterprise group, was approved to produce cars to accelerate economic globalization. Samsung Group has wanted to be involved in the automobile industry for many years, but has never received government approval. Now that it is allowed to engage in automobile production, it is bound to further promote competition among automobile manufacturers, thereby strengthening the strength of South Korea's automobile industry and making Korea an early success after the United States and the United States. The world's fourth largest automobile producer after Japan and Germany.

Third, actively explore overseas sales markets.

Given that the domestic automobile sales market is almost saturated, South Korean automobile manufacturers are making every effort to explore overseas markets for their own survival and development.

On the one hand, "Hyundai" strives to consolidate its original sales markets such as the United States, and on the other hand, it actively establishes production and sales bases in China, Southeast Asia, the Middle East and Africa. To this end, assembly plants have been established in Zambia, Botswana and other countries in southern Africa, Indonesia, the Philippines and other countries in ASEAN, and Canada in North America. It plans to produce 300,000 cars overseas by 2000 and establish more than 300 sales points and service networks around the world. It also plans to establish an automotive research institute in the United States. The company took advantage of the current appreciation of the yen to actively seize the Middle East market, resulting in a surge in automobile exports to Middle Eastern countries.

At the same time, Korean automobile manufacturers are also rushing to attack the Oceania market. At present, the number of cars exported to Oceania by "Hyundai" and "Daewoo" has surpassed Japan's Nissan and Mazda, ranking second after Japan's Mitsubishi.

In addition, Korean automobile manufacturers are also actively launching offensives in the European market.

"Kia" has introduced its newly developed 1.6-liter fuel-injected 4-door sedan to the European markets such as the United Kingdom, which is very competitive. "Modern" independently designed and manufactured light cars, with a short body but large interior space, are at the world's leading level and are very popular among customers in European countries. "Ssangyong" has launched a 4-wheel drive Musso sedan designed by Americans and using the engine of German Mercedes-Benz in the European market, which is also a very competitive product.

In short, the Korean Automobile Industry Corporation is working hard to open up larger overseas markets to meet the future of the automobile industry.

Fourth, actively participate in competition in the Chinese market.

The world's automobile industry, including the Korean automobile industry, generally believes that China, with a population of 1.2 billion, is the largest remaining automobile market in the world. Especially with the rapid development of China's economy, cars have gradually begun to enter families. Although China itself is working hard to develop its automobile industry and plans to produce 3 million cars annually by 2000, it still cannot meet domestic demand. Therefore, the world's major automobile manufacturers have launched fierce competition to occupy the Chinese automobile market. In this regard, South Korea is doing its part and going all out. In fact, in recent years, South Korea's "Hyundai", "Kia", "Daewoo" and other automobile companies have launched an offensive to enter the Chinese market. In 1990, during the 10th Asian Games held in Beijing, "Hyundai" presented a car to the Asian Games Organizing Committee in the name of sponsorship, which was a signal for Korean cars to enter China.

According to reports, in 1994, Daewoo Group was allowed to establish a car parts factory with an investment of US$2 billion in China, and established a joint venture with China (Daewoo invested US$1 billion) in Changchun City, Jilin Province and other places. A factory with an annual output of more than ten kinds of parts such as engine, transmission and carburetor for passenger cars with an annual output of 300,000 vehicles. [2] At the same time, "Daewoo" also invested US$35 million to establish a large sedan factory in Guilin, Guangxi, and established factories in Jinan and Xi'an with an annual output of 50,000 large sedans.

"Kia" has established a factory in Chengdu, Sichuan Province with an annual output of 10,000 trucks, which has now been put into production, and plans to increase its production capacity to 100,000 trucks by 1996; it has also established a factory in Zhengzhou City. A factory with an annual output of 5,000 25-passenger medium-sized buses.

"Hyundai" has established automobile repair and maintenance plants in 24 major cities in China, including Beijing, Shanghai, Tianjin, and Guangzhou, and has established 4 parts supply centers in Beijing, Shandong and other places. At the same time, "Hyundai" has also established a car factory in Dalian with an annual output of 120,000 vehicles, and a joint venture factory in Guangdong Province with an annual output of 3,000 passenger and cargo vehicles (Korean parts and components, Chinese assembly), etc.

South Korea’s Ministry of Commerce, Industry and Energy believes that before the end of this century, China will need to import 200,000 to 400,000 cars every year. Therefore, South Korean automobile manufacturers are working hard to export cars to China. In 1993, South Korea exported 57,000 cars to China through formal and informal channels, making China the second largest car export target country after the United States. By 1994, China had imported another 1,100 Sonata II sedans from Hyundai and 5,000 sedans produced by Daewoo through barter trade (China paid for corn and mechanical parts). Kia and Ssangyong are also taking measures to gain a place in the Chinese automobile market.

In short, due to the various effective measures taken by the Korean automobile industry to promote the development of the automobile industry, considerable results have been achieved. At present, South Korea has not only become the world's sixth largest automobile producer and fifth largest automobile exporter, but also one of the six countries among the top 12 largest automobile producers in the world that can produce its own trademarks (the United States, Japan, Germany, France, South Korea, and Italy). )one.

Of course, South Korea still faces many difficulties on the road to developing its automobile industry. For example, wages of domestic workers are rising rapidly, product export competitiveness is decreasing, some automobile companies have ongoing labor disputes, and developed countries such as the United States There have been ongoing frictions with South Korea over car exports. But these difficulties are not insurmountable. By the beginning of the next century, the Korean automobile industry will definitely have a larger scale and occupy a more prominent position in the world.

The Asian financial crisis severely impacted the Korean national economy and automobile industry. The 1998 financial crisis was most obvious in the Korean economy. The country's economy recovered in 1999, but returned to the level of 1990. It will take some time for South Korea to intensify macro-regulation to solve debt and other problems to accelerate economic recovery. In the next few years, South Korea's economic development speed will steadily increase, and will be stimulated by increasing domestic demand and expanding exports. Economic recovery and automotive industry development. Mergers and reorganizations bring hope to the development of the automobile industry.