By on May 9, 2010

Give up? The answer is that they’re giving South Korea a headache. OK, let’s go back a bit. The Korea Times reports that something funny is happening to the South Korean car market. Effectively, for years, the South Korean car market used to be closed off to foreign competition, thus, keeping domestic production and sales high. The market for foreign was only for the exclusively rich who didn’t mind paying the tariffs. But now, even the proletariat is getting in on the act. In spite of a global slump in the market, the Korea Automobile Importers and Distributors Association (KAIDA) reports that foreign imports rose, month on month, by 51.1 percent, to 7,208 units in April.  Still a drop in the water: Korea makes 3.5m cars in a good year, of which 2.5m are exported. But it’s a start.

The reason for this surge in foreigners invading South Korea lies with the very reason South Koreans are invading other markets. “Prices of domestic vehicles have substantially appreciated during the past years in line with improving quality and brand power. In comparison, those of foreign ones decreased to cut down on the difference between the two,” a Seoul analyst said.  “Hence, Koreans now have few reasons to stick to cars of Hyundai Motor or Kia Motors. They tend to buy whatever models, which attract them in terms of price or quality and such aspects will only strengthen further down the road.” Quality can be a pain in the wallet. Also, there is a thing called WTO. It cuts both ways.

Now, Ford Korea and BMW Korea are having trouble supplying the South Korean public with enough units of the Ford Taurus and the BMW 523i to keep them placated. BMW could only supply 200 units, trouble was, demand asked for 3000 units. And it’s not just BMW and Ford that are enjoying this boom. Similar stories exist for the Toyota Camry and the Volkswagen Golf TDI. South Korea’s population is currently at just over 50 million people. Which means that a significant market could be opening up for foreign car makers. And an almighty headache could be around the corner for South Korean car makers. Anyone got a Tylenol?

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34 Comments on “What Do The BMW 523i And The Ford Taurus Have In Common?...”


  • avatar
    Steven Lang

    South Korea has been a fiercely protectionist market for a very long time.

    Funny thing is the younger generation who LOVE cars want absolutely nothing to do with it, and even older generations are realizing that an economy bent on protecting the manufacturing sector hurts their ability to compete in services. The former helps create the demand and potency of the other and without any real competition, services suffer.

    The current SK economy is diversified enough that it can withstand a lot more competition in the automotive sector without any real loss in jobs. In fact, the population is large and affluent enough to make most manufacturers consider it as a distinctive focus for their operations.

    The only question is whether the current government will free the market up a bit and let their citizens have the choices that make capitalism work.

  • avatar
    dwford

    One of the criticisms of Detroit is that they don’t export cars from the US, that they have separate operations for different parts of the world. In reality, while small, Ford is exporting its US product line all over the world – even Mercury and Lincoln!!

    Who knew that the South Koreans would love the Taurus, though??

  • avatar
    TrailerTrash

    I have been to many counties and I understand the difference of the buying public, when it comes to cars.
    Our country was developed in the late fifties and sixties for highway driving. We are alone in this.
    Other countries have the distances, but not the highways on which to really cruise.
    I have never been to SK, but guess it to be like Japan, maybe China.
    Japan just doesn’t have many really long cruising highways, and they love trains.
    Europe loves, deservedly so, their trains for driving transnational since they cross borders like we cross state boundaries and their cities are nothing but alleys with coffee shops, narrow walkways with dog pee and bistros.
    China has congestion in the urban areas, crappy roads in rural.
    So why would they be interested in cars that really feel better on highways?
    Are really rich buying these for urban areas and damned the fuel cost?

    • 0 avatar
      sHighlander

      Your viewpoint of “rural crappy roads” in China is very outdated. China has been busy building highways for the past few years, and how has a network of expressways that rivals the United States’. They’re better paved, too.

      Granted, there still aren’t many cars on most of them, but that will come.

    • 0 avatar

      Trailertrash, your mission is to buy a ticket to Asia, with a stopover in Europe.

      Japan just doesn’t have many really long cruising highways, and they love trains.

      Japan has a huge national highway and expressway system. Better maintained than in the U.S. (That’s just how the Japanese are.) Careful, they drive on the wrong side of the road.

      Europe loves, deservedly so, their trains for driving transnational since they cross borders like we cross state boundaries and their cities are nothing but alleys with coffee shops, narrow walkways with dog pee and bistros.

      Tell that to the Europeans. They love their cars with abandon, and their highway system is legendary. Ever heard of the “Autobahn?” Also better maintained than in the U.S. Apparently, you’ve been hanging out in Amsterdam’s “coffee shops” for too long.

      China has congestion in the urban areas, crappy roads in rural.

      Aha. China has poured untold amounts of concrete and blacktop into a huge expressway system, the world’s second longest, after the U.S.A. If the signs wouldn’t be Chinese, you would think you are on a German Autobahn, Ah, and they also are quickly developing a high-speed rail network. They already have the world’s fastest trains, and soon their high speed rail network will exceed that of Europe.

      You need to get out more!

    • 0 avatar
      TrailerTrash

      Bertel…I have been to China 4 times and traveled the back country many times.
      Even boated up the Yangtze, awakening to find a rat on my chest.
      I have no idea of which you speak…rural road wise.
      That so called highway system is nothing more than two lanes.
      Nothing even close to the highways across the US.

      You are more than likely correct on the European roads as I do not often visit there and certainly spent my time in the cities, seldom leaving for the country. Whenever I did, it was by train.
      Euros love their cars. Maybe I am wrong about the average or majority of cars purchased in Europe. However, all we are forever scolded by Europe for our large cars and reminded of their better, more environmental aware and sensitive lives. Do they or do they not purchase smaller cars than we do?
      I would like to know what is the truth.
      Isn’t that why we hear about the American car being build for the fat American?
      I think this is a way of commenting negatively on our larger cars.
      I insist that this is not our weight, but I love of long drives on large highways.

      EVERY time this talk comes up, the one darn super road they have gets pushed to the front again and again.
      Is this the only big highway they have?
      Never having experienced it, we do have lots of roads here that are limited ONLY by our government for speed.
      If left to reality, they would not have a limit.

      Please enlighten.

    • 0 avatar

      Been in China lately? As in, a few weeks ago? My work takes me to pretty strange places, where no tourist ventured before. Just a few weeks ago, a factory owner drove me down a six lane highway, which my Google map said wasn’t there. Actually Google claimed the next highway was some 50 miles away. Then we drove to a city Google map said wasn’t there.

      Expect the unexpected. Construction on the high speed railroad from Beijing to Shanghai started 2 years ago. They’ll be finished next year. It’s 800 miles long. Trains will go 240 mph. The 8 mile AirTrain in New York took longer to build. And it ends in Jamaica. Jamaica, Queens.

    • 0 avatar
      TrailerTrash

      Bertel…

      Yes, they are doing well with trains.
      In fact, my brothers and I nearly booked the high speed to Tibet when it first opened, until we read more and realized the breathing nightmare it was.

      The very last time I was in China for a very long period was about 2 years ago.
      But unless they are a super race, and I sure didn’t see any signs of this, it seems very unlikely super highways have begun to ribbon the countryside.
      Now, I never meant to imply there isn’t any highway system, since near the cities they do have the usual mass highway nightmare we experience here.
      Only louder and crazier.

      But no, there is no super highway system even close to what we have blanketing their country.
      Shanghai is like a city in the future, with side streets cluttered with bikes and squatting venders cooking food.
      Very strange, indeed.
      Their train system is just OK, as long as again you stay near the east and cities. I have ridden the Hangzhou to Shanghai train many times and it’s a better ride than Amtrak!
      But it’s a surreal ride, full of shanty former communist concrete worker villages intermittent with beautiful homes and villages. Not my expectations for any nation.

      I do not expect this system to produce a national highway system in 2 years.

      Tell me, what size auto do most Europeans drive and why?

    • 0 avatar

      The Chinese – got worried about their economy after a company called Lehman Brothers went under. They dumped some $600 – $700b into infrastructure projects, right after you left. Infrastructure projects like roads, rail, ports. With considerable effect. Come back and visit.

      The Europeans – drive everything from small cars to something called the S-Class.

      The Chinese – as amply chronicled here, drive everything from small cars to something called the S-Class. Actually, they are the world’s largest S-Class market. They also have this thing for big cars, “extended wheel base” is a Chinese phenomenon. They are one of the last markets where SUVs are not considered a crime against humanity. When they don’t drive their cars, they sit by the side of the road and cook food over open fires.

      The Americans – have recurring fantasies about road trips from coast to coast, but generally take something called the aeroplane for the longer haul. By doing so, they are less worried about exceeding the extra cheap 8000 mile/year lease.

      Disclosure: Author once owned a 1972 DeVille with a 472, along with a Chevrolet Caprice wagon. Later in his life, he used a Ford Expedition for weekly shopping trips to Kroger’s. He emigrated to China to escape repercussions from his antisocial behavior.

    • 0 avatar
      psmisc

      @TrailerTrash,

      In China, a “highway” refers to any intercity road, paved or not, which they has tons. I think what you meant are “express ways” (75mph), which like Bertel mentioned, is the second longest in the world.

      http://en.wikipedia.org/wiki/Expressways_of_China

      Btw, the train to Tibet is not high speed, it’s just a slow train with a really long track and insane engineering. Their bullet train network (120mph – 220mph) is already the longest, surpassing the European network. They also have the fastest-running services (both metal and maglev, thanks to Siemens).

      http://en.wikipedia.org/wiki/High_speed_rail_in_China

    • 0 avatar
      Signal11

      I travel/have traveled quite a bit, too.

      In fact, it generally takes me roughly four to six months to burn through an extra page supplemented US passport. The only continents to which I don’t extensively travel are Antarctica and Australia.

      I disagree with almost everything you wrote.

      Geographically, SK is like Japan, in that the country is mostly mountainous and (mostly) surrounded by water. China is nothing like Japan or Korea in the sense that it’s geography can’t be encapsulated in a nutshell. In fact, one could easily make the argument that China is more geographically diverse than the US.

      The Chinese can build quick enough to make your head spin. In my Western engineer’s opinion, usually of sub par quality, but Chinese infrastructure engineers work incredibly fast. I’ve seen them lay down fiber at roughly 5-10x the rate of equivalent Western firms. In their own back yard, they can work even faster due to easy access to labor. I’ve shown up just two or three years after visiting old friends in China and been blown away by the rate of road construction.

      As for Europe, I’ve really only lived for a couple years in Germany, Italy and the Netherlands but I’d say that the highways are just as well maintained, if not better than the US. Obviously gets better the further north you go.

  • avatar

    I’m sure BMW gives everyone a headache. There are people (like me) who refuse to be seen in anything less than a BMW, Benz, Audi or Lexus. I like the Taurus but I don’t like its driver position.

    Against BMW and the Taurus, the Genesis is WEAK. Its only saving grace is its lower price.

    • 0 avatar
      kablamo

      Genuine question:
      “There are people (like me) who refuse to be seen in anything less than a BMW, Benz, Audi or Lexus.”
      Why is that exactly?

      When the Prius came out, lots of traditionally luxury-buying folk bought the Toyota – the desire for exclusivity and differentiation is a segment of the car-buying population (who must also have deep pockets).

      What’s being described in SK is also seen in other markets where foreign=exotic=good to some. The declining price differentials in SK just make it that much more attainable.

  • avatar
    Monty

    I wonder if certain Ford haters saw this headline and spit-up their morning coffees?

  • avatar
    vento97

    The last REAL BMWs built consist of the 2002-series (2002, 2002ti, 2002tii), and the M1. Those automobiles represent the TRUE essence of BMWs befitting the title “Ultimate Driving Machine”.

    The arrival of the 3-series and the self-important yuppie poseurs who started purchasing them (even to this day) resulted in BMW from that point on becoming synonymous with pretentiousness.

    • 0 avatar
      Jackalope30

      “The arrival of the 3-series and the self-important yuppie poseurs who started purchasing them (even to this day) resulted in BMW from that point on becoming synonymous with pretentiousness.”

      You’re joking right? When WASN’T BMW a premium brand that carried with it a premium price? When WASN’T it surrounded by a premium crowd that was stuffed full of its own weight in ego and self-righteousness? The crowd of poseurs may have gotten younger and invented a new nameplate for themselves, but nothings really changed.

      The most annoying thing about the “Ultimate Driving Machine” moniker is that they, BMW’s marketing department and the poseurs who provide job security to it’s employees, are right. A car that can soak up the bumps and cut wicked lap times while combining above average economy with the practicality of a family sedan while losing none of the coolness of a sports car really is the ultimate driving machine. Its a feat no one has really been able to replicate so far (2nd gen CTS-V comes close though…) despite decades of effort on the part of enemies domestic (Merc, VW group) and foreign (Nissan, Toyota, GM with the excellent 2nd Gen CTS-V) and the presence of a crowd of poseurs changes none of that.

    • 0 avatar
      Lexingtonian

      “When WASN’T BMW a premium brand that carried with it a premium price?”

      You’ve never heard of the BMW Isetta, then, I presume?

      Or been to Munich. As an American, one of the most amusing thing to me visiting Munich was seeing that about a third of the cars on the road were BMWs. And most of those were 3-door hatchbacks with 2 liter engines. And they cost about as much as a Jetta.

      BMW’s “premium” status in the US market is a result of simply exclusively exporting their higher-tier models to the US. While they don’t make any truly low-end models, their actual baseline model is a hell of a lot cheaper than what they send over the pond.

  • avatar
    Z71_Silvy

    This is great news. I say ship every single one of the mediocre Taurus’ over to Korea. That way…we won’t have to see Ford’s impression of a Camry here.

    • 0 avatar

      I think thats what the Koreans said about the Chevy (Daewoo) Aveo

    • 0 avatar
      Loser

      Even better news would be Buick sending all it’s equally mediocre LaTosses. That way we won’t have to see Buick’s impression of Fords impression of a Toyota here. Hell, just send them the complete Buick lineup!

    • 0 avatar
      Z71_Silvy

      1. Why would you compare Buick with Ford…one is a entry level luxury brand the Ford is a shoddy, blue-collar brand that is trying to mimic Toyota in producing the most bland vehicles on the planet.

      2. The Lacrosse competes with mediocre appliances like the Lincoln Taurus….which it handily outsells. The MKTaurus is a complete failure and a severely overpriced entry level luxury appliance. The Avalon and LaCrosse are far better cars…

    • 0 avatar

      I would much rather have a bland looking, reliable, good gas mileage car then a car built only for styling (which arent that good to begin with)

    • 0 avatar
      Loser

      “Why would you compare Buick with Ford”

      Don’t ask me, ask Buick why they have direct comparison literature between the two at our local dealer. Google “Buick Lacrosse vs Ford Taurus” or read any car magazine. If you read the reviews there isn’t a clear winner between the two. So much for the Buick being a much better car.

      “Ford is a shoddy, blue-collar brand that is trying to mimic Toyota in producing the most bland vehicles on the planet.

      2. The Lacrosse competes with mediocre appliances like the Lincoln Taurus….which it handily outsells. The MKTaurus is a complete failure and a severely overpriced entry level luxury appliance. The Avalon and LaCrosse are far better cars…”

      Some proof it’s a complete failure, severely overpriced and that the Avalon and LaCrosse are far better cars?

      I’m not a huge Ford fan but I do currently own one and have owned them in the past. Along with the Ford I have 2 GM products. Fords are far from shoddy and no worse than anything GM sells.

  • avatar
    Steve Biro

    “Lexingtonian
    May 9th, 2010 at 12:19 pm

    You’ve never heard of the BMW Isetta, then, I presume?

    Or been to Munich. As an American, one of the most amusing thing to me visiting Munich was seeing that about a third of the cars on the road were BMWs. And most of those were 3-door hatchbacks with 2 liter engines. And they cost about as much as a Jetta.

    BMW’s “premium” status in the US market is a result of simply exclusively exporting their higher-tier models to the US. While they don’t make any truly low-end models, their actual baseline model is a hell of a lot cheaper than what they send over the pond.”

    And, even in the U.S., the BMW 1600s (think 2002 with a smaller engine) of the late 1960s may have been somewhat premium – but in a very modest way. They were premium in the way a VW Type 3 fastback or wagon was premium to a VW Beetle. It wasn’t until the 2002s began to take off (particularly in tii trim) in the early 1970s that BMWs were really taken seriously as a premium product by most Americans – those outside of tightly knit enthusiast circles.

  • avatar

    There is really nothing American about the current Taurus. It is basically a volvo rebadge. The Koreans are basically responding to a Swedish car. When it comes to engineering Detroit is basically out of the car business.

  • avatar

    It is far truer than you think. Name one American car today and you can trace its origins to foreign engineering. The US has joined the UK in second tier status among world car makers.

    In fact it is now a source of embarrassment and shame for the all Americans.

    • 0 avatar
      windswords

      How about 3? Dodge Viper, Chevrolet Corvette, Ford Mustang. All of them engineered in the US. I don’t care if some of their parts are built overseas. That’s called bidding for the best quality/price. You would be crazy not to get your parts from the best company price /performance wise. That’s just business 101

  • avatar
    Telegraph Road

    The engineering content of vehicles is much more than the base platform. What Volvo has an EcoBoost powertrain?

    And what foreign engineering can be traced to the most popular vehicle in the U.S., the Ford F-150?

    • 0 avatar
      newcarscostalot

      Perhaps he means parts sourced from other countries, not engineering. I have always wondered, do Chinese or Europeans, for example, complain about cheap American Made crap taking jobs away from them?

  • avatar
    NN

    I can’t see the Taurus really being popular in Korea. Maybe Ford is only sending 100 of them over for 2010, and there’s demand for 150.

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