The Korea Vehicle Producers Affiliation (KAMA) projected on Dec. 5 that the home vehicle business’s gradual restoration development will proceed subsequent yr, with will increase anticipated in manufacturing, home gross sales, and exports. This comes from the “2025 Vehicle Business Evaluation and 2026 Outlook” report.
In accordance with the report, home gross sales are projected to report 1.69 million models in gross sales quantity, a 0.8% enhance from this yr, as electrical car subsidies develop, 16 new car fashions launch, and alternative demand will increase as a consequence of ageing autos. Autos scheduled for launch subsequent yr embrace the GV90 EV and HEV Seltos, KG Mobility’s new pickup Q300, and Renault Korea’s Aurora2. Getting older autos over 10 years outdated elevated from 8.98 million models in 2023 to 9.93 million models as of October this yr, creating expanded alternative demand. Nonetheless, KAMA seen that if particular person consumption tax reductions are discontinued, demand will plummet sharply, making the 1.69 million unit gross sales goal unimaginable. Moreover, family debt approaching 2,000 trillion received and the full-scale retirement of the child boomer technology are anticipated to maintain home gross sales beneath 1.7 million models in the intervening time.
Exports are anticipated to succeed in 2.75 million models bought, a 1.1% enhance from final yr, as commerce dangers with the U.S. are mitigated via the confirmed software of a 15% tariff and deferment of port entry charges, together with international hybrid preferences, strengthened European environmental rules, and full-scale operation of home EV crops. The strengthening of home eco-friendly car manufacturing capability, together with Hyundai’s Ulsan EV plant and Kia’s Gwangmyeong and Hwaseong EVO crops, is predicted to help export restoration, with export worth projected to succeed in $72 billion (roughly 106.5 trillion received).
Manufacturing is projected to extend 1.2% in comparison with this yr to 4.13 million models, breaking away from two consecutive years of adverse development and turning to optimistic development as the twin pillars of simultaneous home gross sales and export restoration and new plant operations align.
This yr’s vehicle business was analyzed as having home gross sales pushed by eco-friendly car market development and authorities insurance policies regardless of burden components akin to excessive change charges and consumption contraction. With the bottom impact of a 6.5% lower in home vehicle gross sales final yr and enhancements in coverage and market components akin to rate of interest cuts and particular person consumption tax reductions, gross sales quantity is estimated to report 1.677 million models, a 2.5% enhance from the earlier yr. Primarily based on cumulative figures from January to October, eco-friendly car gross sales elevated 27.5% to 676,000 models, main the home market restoration.
Exports are projected to complete 2.72 million models, a 2.3% lower from the earlier yr, because of the U.S. imposing a 25% excessive tariff for seven months beginning in April and the transition to native electrical car manufacturing. Though gross sales volumes elevated 5.9% in Europe and 13.6% in Central and South America, offsetting the U.S. market hunch, they didn’t fully compensate for it. Manufacturing can be anticipated to report 4.08 million models, a 1.2% lower.
KAMA Chairman Kang Nam-hoon acknowledged, “2026 will probably be an essential turning level the place our business could make a big leap ahead because the full-scale operation of home electrical car crops and growth of eco-friendly car exports align,” and “For home market restoration, home demand stimulation measures akin to particular person consumption tax reductions and help for ageing car alternative should proceed.” Kang added, “New pressures are being added throughout our business, together with fast growth of Chinese language manufacturers, heightened protectionist commerce traits, and labor union legislation revisions,” and “Manufacturing incentive insurance policies akin to ‘home manufacturing promotion tax system’ to alleviate worth and price burdens on home autos are additionally pressing.”
