With GM’s major restructuring, consumers have preferred high-end German engineering to one whose after-care services residual value is uncertain.
German engineering is making history in South Korea: for the first time, BMW and Mercedes vehicles have outsold those from General Motors.
Consumers have shied away from purchasing GM vehicles after its announcement of a major restructuring.
Although home-grown automakers, including Kia Motors Corp and Hyundai Motor have dominated the auto industry in South Korea, in recent years, brand conscious South Koreans seem to prefer high-end German vehicles.
According to industry data, BMW’s sales saw the biggest jump and has nearly doubled its vehicles to 6,118 vehicles, with Mercedes a tad second with 6,192 cars, up by 12% from the same period a year earlier.
In 2017, Mercedes climbed up 2 spaces to become the 6th biggest vehicle seller in South Korea.
Last month, GM had announced that it would be shuttering one of its factories in South Korea as it weighs the fate of the remaining 3. This announcement resulted in GM losing nearly 50% of its domestic in February to 5,804 vehicles.
South Koreans are worried on the loss of after-care services and the residual value of their vehicles. As a result GM has slipped to the 6th position.
“We hope to wrap up talks with the labor union and the government swiftly,” said a spokesman for GM Korea.
He went on to add, “A drawn-out restructuring will hurt consumer trust”.