The Korean Automobile Manufacturers Association has released the “2022 Analysis of New Car Registrations” report.
According to the report, the number of new car registrations in 2022 was the lowest since 2014, despite strong demand, mainly due to production delays. However, due to the increasing preference for electric vehicles and high-end cars, the amount spent on registrations reached an all-time high.
The number of new registrations decreased by 2.9% from 1.73 million units in 2021 to 1.68 million in 2022, while the amount spent increased by 5.7% from 69.6 trillion won to 73.6 trillion won.
Both domestic and imported cars faced a decline in sales volume due to production delays, decreasing by 3.7% and maintaining the same level (+0.5%) year-on-year, respectively. However, in terms of expenditure, both domestic and imported cars saw increases of 3.9% and 9.5% year-on-year, respectively.
Starting in the second half of 2022, improvements in parts supply and rising interest rates led to shorter wait times for deliveries, and prices for used cars, which had been on the rise, began to decline, indicating signs of dampened demand.
A notable feature of the 2022 domestic automotive market was the strong growth of electric-powered vehicles, including hybrid (plug-in and mild HEV), with sales jumping 28.7% year-on-year to 448,000 units, accounting for a market share of 26.7%.
In contrast, sales of diesel vehicles plummeted by 19.8% year-on-year, with 333,000 units sold. This marked the first time that sales of electric vehicles surpassed those of internal combustion engine vehicles, intensifying the shrinkage of the combustion engine market.
Sales of imported cars saw a slight increase of 0.5% year-on-year, selling 311,000 units, primarily driven by German premium brands and Chinese electric vehicles.
Additionally, there were increases in new car purchases by corporations and businesses for both commercial (taxis, rental cars, etc.) and personal use, which rose by 5.6%. Among vehicle types, mid-size SUVs and compact cars benefited from the popularity of SUVs, showing respective increases of 12.4% and 38.8% compared to the previous year.
KAMA Chairman Kang Nam-hoon commented, “The once strong demand for cars shows signs of cooling, with increasing cancellations due to skyrocketing installment rates and a decline in used car transactions.” He emphasized the need for expanded domestic stimulus measures, including support for replacing old vehicles in response to the drastic decrease in demand.
By Lee Sang-jin (daedusj@autodiary.kr)