Newsflash

+++ A new era is starting at AUDI Hungaria. Series production of electric motors has officially started in Győr. The electric motors are produced on floor space of 8,500 square meters with an innovative production concept: modular assembly. The company has invested a double digit million amount to set up the motor production facility. Approximately 100 people are employed in this new area at present. “Audi Hungaria has been involved in writing the growth story of the 4 Rings for 25 years. Our Hungarian subsidiary is now entering a completely new field of expertise with the production of electric motors. This exclusive knowhow makes Győr into our main plant for electric motors and embodies our strategic transformation into a provider of sustainable mobility”, stated Peter Kössler, Board of Management Member for Production and Logistics at Audi, during the symbolic act. “Audi Hungaria is taking on a pioneering role in the production of electric motors. I am proud of our employees’ high levels of expertise and motivation. They have successfully started the production of our new electric motor with great commitment”, said Achim Heinfling, managing director of the factory. The first electric motors from Audi Hungaria will be used in the e-Tron. It is the first all‑electric Audi model and will be built at the plant in Brussels. For the production of electric motors, Audi Hungaria installed the innovative production equipment and islands within just 1 year. The departments for the development of electric motors and for production planning cooperated closely with the prototype manufacturing/ production technology center in Győr to develop the required expertise. The current production capacity is for approximately 400 electric axle motors each day and can be gradually increased. At present, about 100 people are employed in this new area, to be increased to more than 130 by the end of the year. Production is with one‑shift operation, but will soon change to 3 shifts. The electric motor from Győr offers numerous new features. With the stator (one of the core components of the motor) the aim is to insert as much of the thin enameled copper wire as possible into the casing: the tighter the winding, the more efficient the power delivery. A new winding and inserting center at Audi Hungaria makes it possible to wind the optimal amount of enameled copper wire particularly compactly and then insert it into the casing. The electric axle consists of other large components such as the power electronics, which are located in their own housing, the gearing and 2 flange shafts that transmit the power to the wheels. The employees produce 2 electric axle drive systems for each Audi e-tron, as both the front and rear axles are driven; in good quattro tradition. The production equipment, the robots and the bolting and measuring station are set out in fixed positions but are not linked together by a linear band. Instead, the employees produce the drive systems according to a modular method in production islands. Despite a predefined assembly sequence, the modular system allows branched paths and more free scope in the production process. Driverless vehicles, controlled by an intelligent IT system, transport the parts to the workstations. In parallel to the production facility, Audi Hungaria has installed 3 test benches for electric motors in the engine/motor development department, for testing and continuous load operation. The employees have undergone further training to become electrical experts in the production technology center for electric motors. Audi Hungaria produced 1,965,165 engines last year, making the company one of the world’s largest engine producers. At the plant in Győr, 6 different gasoline engines and 3 different diesel engines were produced in 2017 with power output ranging from 86 hp to 639 hp. Approximately 6,000 employees produce about 9,000 engines each day for 32 production plants of the Volkswagen Group. +++

+++ GENERAL MOTORS (GM) will invest $50 million in its ailing Korean subsidiary and develop it into an R&D foothold for small-to-mid-sized SUVs. GM Korea said Friday that its U.S. headquarters decided the investment will go into its plant in Bupyeong, west of Seoul, 1 of 3 that remain after the closure of the Gunsan assembly plant in May. “In addition to our existing role as a foothold for small SUV development, we will also become the focal point of mid-sized SUV development”, GM Korea said. The new cash injection comes on top of $2.8 million the U.S. automaker promised in May to get its Korean subsidiary back on its feet. GM Korea will start producing a new small SUV in Bupyeong next year that has been under development. At present it manufactures the Chevrolet Trax and Buick Encore compact SUVs (sold as Opel Mokka X in Europe) and the Chevrolet Malibu and Aveo sedans there. For the task of developing a new mid-sized SUV to succeed the Equinox, the company will hire 100 new staff, bringing the total number of R&D staff to more than 3,000. The Korean unit will also take on the role of Asia-Pacific headquarters of the U.S. automaker. GM’s chief of overseas operations, Barry Engle, said, the move is part of the automaker’s pledge with the Korean government to make long-term investments into the Korean unit. After the upgrades, the Bupyeong plant will have a total production capacity of roughly 390,000 cars per year. Cars made in Incheon will be sold both locally and globally. The additional production lines will increase the annual SUV production capacity at the plant by up to 75,000 vehicles per year. Barry Engle, the president of GM International, said GM has also set Korea as a core base to design, engineer and develop the automaker’s next-generation compact SUVs. The carmaker also plans to establish a new corporation dedicated to engineering and development of global products, dubbed the Engineering Services Unit, later this year. The engineers will move to this unit when it is established, according to a GM Korea spokesperson. Engle also confirmed that GM is proceeding with its plans to establish a regional headquarters in Korea for Asia Pacific markets, with the exception of China. The Detroit-based auto giant signed a memorandum of understanding with the Korean government in May to establish its Asia Pacific head office in Korea to demonstrate its commitment. The regional office is expected to play a vital role in delivering the voice of GM Korea to the Detroit headquarters when making important decisions on new vehicles and manufacturing locations. “We welcome the new investments and appreciate the vote of confidence in our engineers to deliver these important global programs”, said GM Korea President and CEO Kaher Kazem. He said the new investments will help the company with its turnaround plan. “We have launched new products this year, like the new Spark and Equinox, and achieved our best monthly sales this year in June”, Kazem said. “We have almost doubled our market share in the past 3 months”. According to GM Korea, the company sold 46,546 cars in June, with 9,529 sold domestically and 37,017 exported. These were GM Korea’s best monthly domestic sales this year, as they increased by 24.2 % from May. However, when compared to the same time last year, June sales fell by 16.8 %. +++

+++ The HONDA Civic can now be bought with an automatic gearbox in tandem with diesel power. Introduced earlier this year, the 1.6-litre i-DTEC diesel Civic has until now only been available with a 6-speed manual gearbox sending drive to the front wheels, but that’s changed thanks to the addition of a nine-speed automatic option. The new transmission, with its wide spread of ratios, is capable of skipping gears to improve smoothness and fuel economy. It also means that the diesel Civic is the only Civic available with a proper automatic transmission; both petrol variants are only offered with a manual or a CVT gearbox. The 1.6-litre i-DTEC unit produces 120 hp and 300 Nm, and Honda claims performance figures of 0-100 km/h in 11 seconds. That’s a slight performance deficit compared to the manual model. Fuel economy dips too. The Civic diesel automatic is rated at 109 g/km for the 5-door hatchback, and 108 g/km for the new, slightly more aerodynamic 4-door saloon. Unlike the hatchback, the new body shape isn’t built in the UK at Honda’s Swindon plant, but rather is assembled in Turkey. Both variants are on sale now, available with the new diesel automatic powertrain. +++

+++ On highways connecting major cities in Spain as well as on the narrow, cobbled streets of old towns, Korean cars have become a common sight. From the all-new i30 to Kona, HYUNDAI ’s latest vehicles are easily spotted on the streets of Europe, probably more frequently than in China and the US, the 2 major markets being targeted by the company. And most of them are new models. Europe had previously taken a back seat in Hyundai’s export plans but this year’s data shows sales in the continent accelerated faster than in China or North America. And Hyundai has been seeing record-high sales growth there despite the overall market in Europe slowing. The momentum for growth could continue, considering that 90 % of Hyundai and Kia vehicles being marketed in EU were launched in the past 2 years. They are targeting younger drivers in Europe, as a tactic to improve its brand value in a market that is home to carmakers with loyal customer bases and more than 100 years of history. In the January-May period, the South Korean auto giant sold a total of 445,842 passenger vehicles in Europe under the Hyundai and Kia brands, marking it the fifth-largest carmaker in terms of combined market share, with 6.3 % of the market, according to the European Automobile Manufacturers Association. In terms of the percentage of new passenger car registrations, Hyundai alone ranked second with 8.2 %, after PSA Group, which recently acquired Opel and Vauxhall from GM, provisional data showed. Kia grew 4.8 % in the same period this year, ranking 6th. Since entering Greece in 1977 with 300 units of the Pony, dubbed Korea’s first-ever car, Hyundai has gone through tough times in Europe, home to a number of auto giants, including Volkswagen, BMW and Renault. It was more than 30 years before the carmaker was able to reach European sales of half a million units a year in 2008. But less a decade on, the Hyundai Motor Group is on course to sell more than 1 million units in Europe for the first time this year. Moreover, Hyundai and Kia launched their first regional headquarters in Frankfurt, Germany, last month, to quickly respond to the fast-changing European market, the company said. Germany, home to Volkswagen, BMW and Mercedes-Benz, is the largest European market for Hyundai in the region after the UK and Spain. Their designs appear to have attracted young customers in Europe, as well as the low defect rates, said Choi Dong-woo, executive vice president of Hyundai Motor Europe Headquarters. “According to market survey, design was the first purchasing factor, and we see high scores on the design feature of strategic vehicles to Europe including Tucson, Kona and i30”, he told. Hyundai and Kia are known more as SUV makers than producers of compact cars. The Tucson was the best-selling Hyundai car in Europe with 47,244 units sold as of April this year. The company sold 154,056 units last year. A facelifted Tucson will likely hit the market in the second half of the year. The market image of Hyundai as a green carmaker in Europe is also expected to fuel its growth. “Hyundai and Kia responded fast toward Europe’s anti-diesel movement by placing nondiesel, energy efficient vehicles such as Ioniq and Niro”, said Lee Jae-il, an auto analyst at Eugene Investment in Seoul. Hyundai’s Europe chief also vowed to expand its green lineup, bringing Kona EVs and Nexo to the front, which he believes will improve the carmaker’s brand value in the future. Hyundai became a global carmaker on the back of rapid market expansion in the US and China in a short period of time. For years, Europe had been considered “a closed market” for Hyundai, as it has loyal customers who take pride in local brands. But the carmaker seems to have potential in the traditional market for the auto industry, at a time when it is suffering from waning sales in China and the US. Of the 4 major markets for the Hyundai Motor Group, Europe was the only region that saw growth in terms of sales per region, according to data from SK Securities. While sales in China took up 20.5 % of total sales in 2011, the proportion dropped to 16.7 % as of January to May this year. North America also saw the proportion of sales drop from 23.2 % to 21.6 percent, and South Korea from 20.6 % to 17.7 %. The proportion for Europe, on the other hand, increased from 11.7 % to 14.1 % in the same period. “Europe is a difficult market in terms of brand penetration, whereas the US has always been open to foreign brands. Hyundai focused a lot on China for years, considering its incomparable market size as well as its past sales growth (before the THAAD dispute)”, Lee said. “Europeans have low preferences toward foreign brands. But if they are to choose among foreign brands, Hyundai and Kia appear to be considered more attractive than Japanese carmakers, considering their specifications and prices”, he said, adding that there are benefits of bilateral free trade agreements. The sales growth, however, has little to do with the profitability of Hyundai and Kia’s business in Europe, according to analysts. “Hatchbacks and compact vehicles have been major products in Europe, but even with the growth of Hyundai’s i-series, it didn’t really have an effect on improving its profitability”, said Hwang Kyung-jae, an auto analyst at CGS CIMB in Seoul. “The profitability of Hyundai’s global business rather depends on growth in emerging markets like Brazil”, he said. Hyundai may have proven its strength in the compact vehicle segment, but will it succeed in climbing up further to the upper segment, and start building its image as a premium brand? Market observers said that it may be premature to introduce the Genesis brand. “In terms of brand profile, Hyundai will always be targeting the “low-mid” end; a very strong value proposition with luxury options at cheap prices”, said Sam Ha, equity sales manager at Kepler Cheuvreux in Paris. “The decision to make Genesis a stand-alone brand is interesting but will take a lot of marketing firepower to bring the brand image to a higher level than Hyundai and Kia. Genesis would have been more successful if it was marketed as a pure-EV brand, similar to Tesla”. Hyundai has no plans yet to launch its Genesis brand in Europe. +++ 

+++ LAND ROVER has applied to trademark a curious and peculiar new name: Road Rover. Officially, little can be said about the group’s interest in the new badge. Carmakers trademark potential names all the time, either for the purposes of actual new models or to keep certain names out of the hands of competitors and trademark squatters. For instance, sisterbrand Jaguar has a fleet of potential names currently trademarked, including J-Type, J-Pace and C-Pace. However, the Road Rover name flings open the imagination quite like no other. At the very least it could just be an internal slogan or reserved for a future PR stunt. At most, it suggests that JLR is considering a revolutionary new car, distinctly shaped as a separate entity and sitting lower than the brand’s traditional SUVs. I’ve nothing to go on at this stage, though the idea of a Road Rover wouldn’t be entirely new. The name has in fact been used internally before, on a series of prototype vehicles developed by the brand in the mid 1950s. Intended as a car to boast at least some of the off-road prowess of the Series 1 Land Rover, the project was very much focussed on on-road manners instead, but failed to result in a production model. Similar, modern day interpretations of this format would be Audi’s Allroad line-up, Volvo’s Cross Country vehicles, and the Mercedes E-Class All-Terrain. However, it’s impossible to say at this juncture if Land Rover has any serious interest in entering this market space. At the moment, the closest thing occupying this space across the Jaguar Land Rover line-up is the new, all-electric Jaguar I-Pace. I don’t know if Road Rover itself is a direct spin on Land Rover either. It could in fact be spun off from Range Rover, which would result in a far more upmarket and luxurious vehicle. +++

+++ MASERATI has reported a dramatic decline in sales and revenue in the second quarter of 2018, in sharp contrast to the improving performance of other Fiat Chrysler Automobiles (FCA) brands. Sales are down over 35 % compared with the same period last year, from 13.400 units to 8.700 units. Net revenues have dropped even further, nearly halving from 1.07 billion euro to 568 million euro. FCA cites the impact of a recently imposed import duty reduction in China, with potential customers apparently waiting until it was put in place to get a lower purchase price. However, there were lower shipments and sales “across all markets” despite many markets growing in size, suggesting there are other factors at play. The Italian luxury brand’s latest model, the Levante, was introduced in 2016 into the popular SUV market sector and was promoted as its most important model in years. It almost doubled Maserati’s sales in 2017, but demand has fallen sharply, while older models such as the Quattroporte and Ghibli saloons have also experienced big drops. The poor performance of Maserati comes despite a boost in fortunes for other FCA brands, such as Jeep. The 4×4 maker reported a 21 % year-on-year increase in global sales, with models such as the Cherokee and Renegade proving popular. The FCA Group’s overall adjusted net profits are up 35 % in 2018 over the same period last year, to nearly 2.02 billion euro. Gains in markets such as Brazil and the US have contributed to this, as have lower financial charges and tax expense. +++

+++ MERCEDES-BENZ Korea has installed electric vehicle chargers jointly developed with South Korea’s leading mobile carrier KT at its showrooms and services centers nationwide, the company said Thursday. The electric vehicle charger made for Benz’s EQ EV brand vehicles can also be used to charge electric vehicles with a single phase 5-pin socket. This is part of the automaker’s efforts to provide services that cater to local drivers in its 5th-biggest market, and to keep its position as No. 1 imported car maker. “We are pleased to jointly develop with KT and introduce the charging device, a pivotal element for electric vehicles that suits the local market”, said Dimitris Psillakis, CEO of Mercedes-Benz Korea. “Mercedes-Benz Korea will continuously seek opportunities to build active and close partnerships with local businesses with advanced technologies, like KT, and strive to enhance customer satisfaction by providing products and services that fulfill domestic demand”. The companies signed a deal on electric vehicle charger development in April last year. The product is available for purchase and use at 72 Mercedes-Benz Korea showrooms and service centers across the country, the company said. As an industry first in Korea, Mercedes-Benz Korea has been providing 4G Long Term Evolution telecommunication network in its connected cars in partnership with KT since last year. +++

+++ OPEL has launched a massive, all-encompassing revival project aimed initially at “fixing Europe” and then launching itself into the world’s biggest export markets, first China and then possibly the US. Carlos Tavares, CEO of the PSA Group that acquired Opel last year, is convinced that despite a long history of unprofitability under former owner General Motors (GM), the revived British-German concern can become “a true European champion”. Car customers’ appreciation for “German precision” will be used as a basis to build exports where PSA’s French marques might not do as well. Under new plans announced in Rüsselsheim, Germany, Opel will end links with GM by 2024, building every new model on 1 of 2 highly flexible PSA-derived platforms, CMP and EMP2. It will offer an electrified (battery or plug-in hybrid) version of every Opel model by 2024. The electric initiative will start in 2020 with 4 models: a battery version of the newly launched 2019 Corsa; the Ampera-e; a Grandland X plug-in hybrid; and an electrified Vivaro. PSA’s new and extremely comprehensive development plan for Opel (revealed last week by CEO Michael Lohscheller, engineering director Christian Müller and design chief Mark Adams) introduces a new suite of production efficiencies aimed at achieving a 2 % operating margin by 2020 and a 6 % margin, considered the industry standard, by 2026. The R&D centre inside Opel’s giant Rüsselsheim HQ will be expanded to become a centre of excellence for the whole PSA Group in 15 key areas (including seats, future petrol engines, hydrogen research and US legislative requirements) while keeping its status as the home of Vauxhall-Opel design. Its petrol engine work will include designing a new generation of units, fully capable of hybridisation, for the whole PSA Group. It will also design forthcoming platforms for the whole group’s light commercial vehicles. New platforms will save money: The decision to use just 2 highly flexible platforms instead of a previous 9 is one of the main drivers of future profitability, Opel chiefs claim. Platforms and out-of-sight mechanical parts account for around 60 % of a car’s material cost, and using either the CMP (small) or EMP2 (larger) platform from PSA will save between 20 % and 50 % in development cost compared with previous platforms. Engineering bosses have revealed that the new Corsa is at the 50 % end of the savings scale (clearly because of its under-skin relationship with baby Peugeots and Citroëns) although Opel bosses insist the car will “be very much a market leader in design and quality”. Engineers say the EMP2 platform can support saloon, hatchback, estate, van, coupé and convertible models, with 4 different track dimensions, 5 wheelbases, 2 cockpit architectures and 2 rear suspension designs on offer. It can also accommodate very large wheels, a previous limitation. Simplified engine range with electrification: Vauxhall-Opel says its main powertrain focus will be meeting emissions targets. With PSA (but independent of the group at the time), it made the decision last year to comply with new engine exhaust regulations earlier than required. It now claims 79 of its models already comply ahead of time with forthcoming Euro6d Temp regulations, the toughest standards yet. In future, all Opel models will use just 4 engine families instead of a previous 10. Rüsselsheim will take global responsibility for designing and developing the PSA Group’s 4-cylinder engines in the future (one senior engineer let slip that a 1.6-litre is coming soon, fully hybridised like the rest). Opels will also make good use of PSA’s highly rated family of PureTech 3-cylinder engines. Through PSA, Opel will have access to a new, electrified 8-speed dual clutch transmission, plus an even newer (and extremely light) hybrid ’box, called DT2, with an integrated 48V motor inside its housing both to provide drive or to recover energy when coasting. +++ 

+++ In an attempt to highlight Clio’s French heritage, Renault Samsung, the French carmaker’s South Korean subsidiary, has decided to use the RENAULT marque for the hatchback’s sales in South Korea. Instead of using Renault Samsung’s “storm-eye” badge, the carmaker has attached Renault’s diamond emblem to the Clio, the company said. It means that the carmaker wants to promote Renault as an independent brand, and also that Clio is a compact vehicle that evolved for a long period of time, it explained. Clio is the second car that the carmaker is promoting under the Renault badge. Twizy, an ultracompact electric vehicle, debuted last year solely as part of the Renault brand. Nearly 700 units were sold, demonstrating growing interest in personal mobility, the company said. The Clio, which debuted in 1990, is Renault’s best-selling car, with around 14 million units sold around the world. Considered the “textbook” hatchback, Clio sells more than 300,000 units in Europe each year. For Korean customers, the company has added luxury elements such as light-emitting diode head lamps, a Bose premium sound system and forward collision warning system to Clio. The imported vehicle is also entitled to after-services care from a network of 470 outlets across the country. +++

+++ SEAT ’s Kodiaq alternative, the Tarraco, will finally be revealed in full at an event outside Barcelona on 18 September, and the 7-seat SUV will be available to order before the end of 2018. The Tarraco will be revealed in Tarragona; relevant because the SUV takes that town’s Latin name. The name was selected after 146,000 people took part in a public vote between a number of names, all taken from Spanish towns or provinces. The model completes Seat’s SUV line-up for the time being, joining the smaller Ateca and Arona. It shares its underpinnings with the similarly sized Kodiaq and is likely to borrow much of that car’s engine range and technology. +++ 

+++ SKODA ’s history of producing hot RS versions of its mainstream models will spread into its future electric vehicles. Skoda’s first all-electric car will be a production version of the Vision E concept revealed at the 2017 Frankfurt Motor Show and due on sale at the end of 2020. It’ll be based on the Volkswagen Group’s MEB electric car platform, which will first appear on the VW I.D. hatchback. Skoda’s board member for sales and marketing, Alain Favey, told: “There will be electric versions called eRS. The logic is the same: it’s not about performance as such. Our most powerful engine is 245 hp so by any stretch of imagination we’re not talking about challenging Ferrari.” However, Favey confirmed that Skoda will only offer its EV with one battery output, hinting that the eRS version will focus on handling and cosmetic enhancements rather than performance. “It’s about the look, it’s about the sporty feeling when you’re driving the car, it’s about the seats, it’s about the experience and I think that’s what our customers like”, Favey added. “It’s about the experience and that’s something we can do very well in our future electric cars. Definitely we will have RS versions of our electric cars; it’s part of our brand”. The unnamed production EV is expected to look very much like the Vision E concept, with Favey saying: “Vision E will give you a good idea of what our electric car will look like.” He also confirmed it will have a range of about 500 kilometres, adding: “If it doesn’t have such a range, we shouldn’t come to the market”. The new EV will have a premium price as well, with Favey saying that he expected it to match up with more expensive Kodiaq models, meaning a starting price around the 45,000 euro mark. The Vision E-based model won’t be the only electric car to arrive in the early 2020s, though. Further MEB-based models are expected, including a hatchback that should sit alongside Skoda’s new Golf-sized hatch that’s due to launch late next year. That new model replaces the Rapid, but moves it up a size and will take a different name. Don’t expect to see Skoda’s EV hatchback until around 2022, though. Skoda’s dealers will be gearing up for the new EV launches with an all-electric version of the Citigo, due for launch late next year. “We have 2 years to improve the competence of our dealer network in relation to EVs”, said Favey. The Citigo-E is likely to offer a range of more than 160 kilometres and undercut its Volkswagen e-Up equivalent with a price starting at around 26,000 euro. Favey is also expecting dealers to offer customers high-speed charging, referring to that as a business opportunity. Skoda dealers are expected to go through a bit of a digital revolution over the next 12 months with more in-showroom tech and online sales. “We want to take ‘Simply Clever’ into the showroom”, Favey said. Meanwhile, there’s plenty of life in the RS brand, too, with Favey hinting that a RS version of the next Fabia, which is due in 2021, is on the cards. “We’re working on different options including a RS”, he told. +++ 

+++ Government officials and representatives from the local auto industry rushed to the United States last week to request that SOUTH KOREA be exempted from higher tariffs on imported cars. The Korean delegation, headed by Trade Minister Kim Hyun-chong, met with officials from the White House, Congress and think tanks during their U.S. trip from Wednesday to Friday, arguing that imported cars from Korea should be excluded from the tariff renewal based on Section 232 of the Trade Expansion Act. Finance Minister Kim Dong-yeon on Saturday also raised the issue at the G20 meeting held in Buenos Aires, Argentina. Kim Hyun-chong’s delegation included Hyundai Motor President Chung Jin-haeng and Korea Automobile Manufacturers Association President (KAMA) Kim Yong-geun, among others. The trade minister met with Larry Kudlow, the National Economic Council director, and Mick Mulvaney, the White House Office of Management and Budget director. “Kim explained that the revised Korea-U.S. FTA already reflects the concerns that the U.S. has about its automobile industry and security”, said an official from the Ministry of Trade, Industry and Energy. In March, Korea agreed to extend a 25 % tariff on Korean pickups in the U.S. to 2041, instead of 2021, ensuring the unfavorable export conditions for Korea’s pickup manufacturers continues. “He also emphasized the fact that Korea and the United States impose zero tariffs on cars imported from each other’s country based on mutual benefits”, the official added. According to the ministry, the U.S. officials agreed with the Korean delegation and showed concern that the new tariffs might have a negative effect on America’s labor market and the economy considering the industry’s complex global supply chain. Hyundai president Chung met with lawmakers based in Georgia and Alabama, 2 states where the automaker runs assembly lines. Korea International Trade Association Vice Chairman Han Jin-hyun mostly met with officials from the U.S. government and think tanks such as the Center for Trade and Economics and the Center for Strategic and International Studies. Finance Minister Kim Dong-yeon was also determined to prevent renewed tariffs. “Finance Minister Kim Dong-yeon explained to his U.S. counterpart that the 2 countries have been carrying out fair trade with the renewed Korea-U.S. FTA until now, and expressed his strong opposition to imposing higher tariffs on imported cars from Korea”, the Finance Ministry said in a release. “Kim also emphasized the positive effect that Korea’s auto industry has had in the U.S., such as hefty investment and employment”, the release added. +++ 

+++ The US and the EU have stepped back from a possible TRADE WAR , with the announcement of a proposal to ease tensions and avoid more tariffs. US president Donald Trump and European Commission president Jean-Claude Juncker confirmed they had agreed to stave off proposed car tariffs during negotiations. Trump had previously threatened to impose a 25 % tariff on imported vehicles and parts from the EU. However, a top German industry group is sceptical, saying the tariffs are not yet off the table and there is still no real resolution. US import tariffs of 25 % on steel and 10 % on aluminium, implemented in March, will remain in place during the talks. 3 of the world’s biggest car makers have claimed that trade policy changes are having a negative impact, with Ford, General Motors (GM) and Fiat Chrysler Automobiles (FCA) all reporting lower profit or revenue forecasts. Higher steel or aluminium prices are cited as the main cause, with shares in FCA down 11 %. GM CEO Mary Barra said higher costs were already anticipated but “the challenge has become significantly greater than we expected”. +++

+++ VOLKSWAGEN and Audi have roared back to the Korean imported car market after a 2-year absence. After launching in May, Volkswagen’s Tiguan became the best-selling imported car model in Korea in June. The Tiguan 2.0 TDI sold 1,076 units in June, according to the Korea Automobile Importers & Distributors Association on Thursday. It was the only imported model that sold over 1,000 units last month. In its launch month, Volkswagen Korea sold 1,561 Tiguans. “Although Volkswagen’s brand image was dented due to the emissions scandal, the Tiguan is widely known to be well-made and it seems like Korean consumers have been waiting specifically for the model”, said Kim Pil-soo, an automotive engineering professor at Daelim University. “At the moment, there are no substitutes for the Tiguan that satisfy those who want to buy an imported car in a medium price range. Due to its relatively low price, Tiguan is able to appeal to consumers who were thinking about buying domestic brands”. On the back of those strong sales, Volkswagen was ranked third in sales of imported cars in June with only 2 models on offer, the Tiguan and the Passat. As for specific imported models, BMW’s 5-series sedan 520d came in second in June sales with 963 units, followed by Audi’s A6 35 TDI with 891 units. Korea’s imported car sales continued to grow in the first half of this year. According to KAIDA statistics, a total of 140,109 imports were sold between January and June, which was an 18.6 % year-on-year jump. Mercedes-Benz managed to maintain its top spot for 6 consecutive months. It sold 41,069 units in the Jan.-June period, an 8.9 % year-on-year increase. BMW followed, selling 34,568 units, a 19.2 % year-on-year jump. Japanese brands are expanding their presence in Korea. In the past, Japanese brands were largely neglected here because they were considered overly expensive. Toyota came in third spot in the Jan.-June period. It sold 8,350 units, recording a whopping 60.8 % year-on-year increase. A hybrid version of its new Camry sold 3,051 units in the first half, followed by the gasoline-powered Camry, which sold 2,104 units. Toyota’s luxury arm Lexus tumbled 2 steps from last year’s third spot to fifth, but its sales still recorded solid growth. It sold 6,276 units in the first half, a 7.2 % year-on-year jump. “With the rising interest in imported cars, people who would have bought domestic brands are now turning to import brands. Japanese brands are benefiting from that shift in consumption patterns”, Kim added. +++