South Korea’s commercial vehicle sales plunged amid sluggish domestic demand on a slowdown in Asia’s fourth-largest economy.
Local sales of new commercial vehicles, mostly small trucks, fell 19.2% to 178,700 units in the first 11 months of 2024 from a year earlier, according to Seoul-based automotive data provider CarIsYou on Wednesday.
The sales are likely to fall below 200,000 units this year, for the first time since the information provider started compiling such data in 2012 as the country’s deepening political turmoil following the declaration of martial law on Dec. 3 could pose further downside risks to the domestic economy, industry sources said.
“Domestic commercial vehicle sales are likely to be about 190,000 units only this year if sales in December stay around average levels,” said a CarIsYou official.
New commercial vehicle sales in the country stood at 238,205 units in 2023 up from 228,275 units in 2022 and 225,685 units in 2021.
Declines in the sales accelerated in the second half of this year with a 26.3% drop in October and a 16.6% fall in November.
SLUGGISH ECONOMY, POLITICAL TURMOIL
“Commercial vehicle sales are unlikely to rebound for the time being as the crisis among the self-employed intensifies due to the economic slowdown and a potential impeachment of the president,” said a commercial vehicle dealer.
The National Assembly is widely expected to vote a second time this weekend on the impeachment of President Yoon Seok Yeol’s impeachment, who vowed on Thursday to “fight until the end” attempts to remove him from office after a short-lived imposition of martial law.
Yoon survived the first impeachment vote against himon Dec. 7 after apologizing to the public for causing “discomfort and anxiety” with his martial law declaration.
Used commercial vehicle sales also decreased. The sales of second-hand trucks, vans, buses and others began declinig in August and fell 23.7% in October from a year earlier. The sales rose by more than 10% in July.
The sales of used commercial vehicles, which totaled 330,229 units in January-November, are likely to be around 350,000 units, compared to over 400,000 units in 2020.
“Sluggish earnings at core industries such as petrochemicals, steel and electronics boosted concerns over an economic downturn,” said a commercial vehicle dealer. “Lower sales of small trucks, which self-employed and small business operators usually buy, indicate economic sentiment significantly deteriorated.”
By Jae-Fu Kim
hu@hankyung.com
Jongwoo Cheon edited this article.
