By Choi Kyong-ae
BUSAN, June 8 (Yonhap) -- Luxury carmakers have long viewed the Busan Motor Show as secondary to the Seoul International Motor Show. But this year they participated in the local show to take advantage of the booming sport-utility vehicle demand and promote their more environmentally friendly cars.
The two motor shows are held alternatively every other year. The Seoul motor show, the country's sole international auto show recognized by the International Organization of Motor Vehicle Manufacturers, was held in Seoul last year.
Imported carmakers such as Maserati, Bentley and Jaguar Land Rover Ltd. introduced their first SUVs -- the Levante, the Bentayga and the F-Pace, respectively -- in the biennial motor show which will continue through June 12 in Busan, 453 kilometers south of Seoul.
"Korea is one of Maserati's top five markets, including Italy, in terms of unit sales. We made a 70-percent sales growth last year in Korea. We expect SUV sales to reach up to 50 percent of our overall sales here next year," Fabrizio Cazzoli, regional director of Maserati Asia operations, told Yonhap News Agency on Thursday.
Maserati's Levante SUV will go on sale here in November. Maserati Korea sold about 1,000 vehicles in 2015 with an average price tag of 120 million won (US$101,000) per car, the company said.
"SUVs are no longer an off-road car. These days, they are designed both for on-road and off-road functions. The Levante is extremely roomy, powerful and exclusive," he said.
Jaguar Land Rover Product Manager Jay Kim also cited a higher demand for premium SUVs as the main reason behind its launch of the Jaguar F-Pace SUV in Korea.
"An increasing number of Koreans prefer SUVs to sedans for leisure and camping activities over the weekends. During weekdays, they drive SUVs to work. SUVs are now quiet and sophisticated enough to compete with sedans," Kim said.
In recent years, declining oil prices and changing appetite among customers have boosted sales of high-end, gasoline-powered SUVs globally despite an extended economic slowdown.
Also due to the recent "dieselgate" involving Volkswagen AG, Mitsubishi Motors Corp. and Suzuki Motor Corp., and diesel taxes under consideration, consumers' preference for diesel-powered vehicles because of their fuel efficiency is cooling down.
"As a result, carmakers are placing more gasoline-fueled SUVs in the market to offset declining sales of diesel SUVs. This trend will continue for the time being," Kim Tae-nyun, executive director of the Korea Automobile Manufacturers Association (KAMA), said.
In the January-May period, imported carmakers sold 93,314 vehicles, down 2.3 percent from a year earlier. Diesel models accounted for 66.4 percent of total sales in the five months, down from 67.7 percent a year ago, according to the Korea Automobile Importers and Distributors Association.
In September, U.S. authorities disclosed that Volkswagen installed software on some diesel models of its cars in order to cheat on emissions testing. The German carmaker later admitted that nearly 11 million cars worldwide contained the software.
Also, the Seoul government is moving to strengthen restrictions on fine dust-emitting diesel vehicles, since the particles can cause respiratory problems, which is driving down sales of diesel cars, Kim at KAMA said.
Imported carmakers are not alone in striving for a bigger share in the luxury car market.
In its stepped-up efforts to build a more high-end image, Korea's dominant carmaker Hyundai Motor Co. unveiled its new luxury sub-brand Genesis to compete with imported brands such as Daimler AG's Mercedes-Benz and BMW AG. The company is planning to release five Genesis models by 2020.
Hyundai will beef up the Genesis lineup initially by changing existing models -- the upper-large flagship Equus sedan, the large Genesis sedan and the Grandeur sedan – into the G90, which has already been released; the G80 in July; and the G70 next year.
"I see Genesis as the next logical and consequent step of Hyundai Motor Group's preparations to emerge as premium carmaker. Going into the luxury segment is the very logical step," said Senior Vice President Manfred Fitzgerald who recently signed on as senior vice president at the group to oversee the Genesis brand.
Fitzgerald also said that the "EV is definitely on the map" but didn't elaborate on details or a timeline for the eventual launch of the pure electric Genesis.
He is one of several westerners recruited by Hyundai's vice chairman Chung Eui-sun, alongside the likes of designers Peter Schreyer and Luc Donckerwolke and performance designer Albert Biermann.
Meanwhile, to woo customers away from diesel and other pollutant-emitting vehicles, most participating carmakers aggressively promoted their gasoline-and-battery hybrids, plug-in hybrids, all-electric or hydrogen fuel-cell models during the motor show.
GM Korea Co., which is 76.9 percent owned by General Motors Co., introduced the Volt, a plug-in hybrid electric vehicle, as it sees large growth potential for the car here amid growing concerns about pollutants from diesel-powered vehicles.
Kia Motors Corp. released the plug-in hybrid version of the K5 midsize sedan and the plug-in Telluride SUV concept. Hyundai and Kia, which together form the world's fifth-biggest carmaker, plan to launch 28 eco-friendly vehicles that include six pure-electric cars by 2020.
Toyota Motor Corp. introduced the Mirai hydrogen fuel-cell car and the two-seat all-electric i-ROAD concept vehicle on top of its reinforced hybrid lineup. Renault Samsung Motors Co., an 80.9 percent-owned unit of French carmaker Renault S.A., also launched the two-seat all-electric Twizy.
The Mirai is currently available in Japan, Europe and the U.S. The Twizy will be available in the domestic market later this year, said a Renault Samsung spokesman, adding that countries should establish the charging infrastructure for the all-electric cars.
"We expect hybrid cars to account for more than 50 percent of our total Toyota car sales this year. It is up from 30 percent last year. In the Lexus brand, eight out of 10 cars sold are hybrid models," Toyota Korea President and CEO Yoshida Akihisa told reporters on Thursday.
"We believe hybrid cars will change the lifestyle of customers in the long term."
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