Attending the Chongqing Factory Production Ceremony held at the Hyundai Chongqing Beijing Factory in China in July 2017, Hyundai Motor Company Vice Chairman Chung Eui-haul (center) and Chongqing city officials look around the production line. 2017.7.19/ Hyundai Motor Company
Hyundai Motor Company sold its Chongqing plant in China, where it had invested over 1 trillion won, to a public enterprise in Chongqing for 300 billion won. This plant is Hyundai Motor Company’s fifth factory in China, established in 2017, but closed at the end of 2021 due to poor sales. Hyundai Motor Company also sold its first factory in Beijing in 2021. If the Changzhou plant, which is being sold, is also sold, Hyundai Motor Company’s Chinese factories will decrease from five to two. It shows the current state of Korean manufacturing, which is losing its place in China.
At one time, Hyundai Motors sold over 1 million units in the Chinese market. Market share rose to 7%, but has now fallen to around 1%. This may be due to the spread of the boycott of Korean products in China during the THAAD incident in 2017, but fundamentally, it is largely ignored by Chinese consumers.
Samsung smartphones, which were once first with a 20% market share in China, fell to 0% after being pushed out by Chinese products. Most mid- to low-priced Korean cosmetics brands, which were under the spotlight as K-beauty, have withdrawn, and in the high-priced market, they are losing ground to French and Japanese cosmetics with high brand power . To attribute this to politics, such as the THAAD incident and the Korean War, is to misread the reality. The bottom line is that since the mid-2010s, the quality and brand value of Chinese products have improved dramatically, leading to fierce competition with Korean products.
Chinese companies have increased their competitiveness in the domestic market thanks to the patriotic use of domestic products, and are now looking to the Korean market and changing the global market landscape. Last year, China overtook Japan to become the world’s leading exporter of cars. Korean cosmetics are pushed out of the Chinese market, but domestic imports of Chinese cosmetics are increasing rapidly. Chinese distribution platforms such as AliExpress are aggressively entering Korea and operating there, and Chinese consumer goods are pouring in through these channels. If they stay still without widening the gap with advanced technology and luxury brands, they will be pushed out not only in China but also in the global market.
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