December 01, 2024

• 

KG Mobility's Actyon (left) and Renault Korea's Grand Koleos midsize SUVs (Courtesy of KG Mobility and Renault Korea)

Renault Korea and KG Mobility, the two underdogs in Korea where Hyundai and Kia cars dominate almost 90 percent of the market, are starting to edge in with their latest midsize sport utility vehicles.

As consumer interest in smaller city cars declines, midsize SUVs are gaining popularity here, driven by increasing demand for larger, family-friendly vehicles and automakers’ focus on more profitable segments.

According to September data from the Korea Automobile & Mobility Association, KGM’s new Actyon SUV sold around 1,700 units, and Renault Korea’s Grand Koleos moved close to 4,000 units. Combined, these two new models took nearly a quarter -- 24.8 percent -- of all midsize SUV sales for the month. This is a huge leap in market share, considering both models only launched in August. In just one month, their combined share of the midsize market surged by about 20 percentage points.

The new 2024 Kia Sorento

In contrast, Hyundai-Kia's midsize SUV duo -- Santa Fe and Sorento -- has seen a notable decline. By September, they held just over half the market, a sharp decline of nearly 12 percentage points in just two months. For years, Hyundai-Kia has enjoyed a near-monopoly in this space, so the drop marks a significant shift.

Until recently, Hyundai-Kia's rivals had only a handful of midsize SUVs on offer: KGM's Torres, Renault Korea's QM6 and Chevrolet’s Equinox. Together, these models only made up a little over 20 percent of the midsize SUV market. Including compact SUVs, Hyundai and Kia’s hold on the market was even stronger, with non-Hyundai brands accounting for just 13 percent of all SUV sales.

However, it remains to be seen if these new models will maintain their momentum after the initial buzz dies down. “The real test will be whether they can keep attracting buyers long-term, not just after the launch,” one industry insider noted.

Midsize SUVs are currently leading car sales in Korea. According to data from Carisyou, this segment saw the highest number of new car registrations in September, with more than 326,000 units sold this year alone. This category was the only one to see double-digit growth, with an 11 percent increase in sales compared to last year.

Meanwhile, city cars are having a tough year. Sales in this segment have dropped significantly, with fewer than 80,000 new city cars registered in the first nine months of 2024. That is a steep decline of about 15 percent from the same period last year. In September, fewer than 6,100 city cars were sold, a sharp 39 percent drop from the same month last year.

By Moon Joon-hyun (mjh@heraldcorp.com)