Auto sales in Korea to retreat for 2nd year in 2017: report

Automakers in South Korea is expected to face another bumpy road next year as consumers cut their spending on new vehicles amid snowballing debts and challenging economic conditions, a report said Sunday.

According to the report by Hyundai Motor Co., the country's leading automaker, domestic auto sales for next year are estimated at 1.76 million unit, lower than this year's estimated 1.8 million.

In 2015, a total of 1.84 million vehicles were sold in the country.

"While there are some positive factors such as low interest rates, low oil prices and the releases of new models, demand for new autos will decline due to increased household debts and weak consumer sentiment caused by sluggish employment situation," the report said.

The report expected demand for sport utility vehicles and larges-sized sedans to rise, while the sales of small city cars and compact sedans will remain weak.

Also, foreign automakers will be able to expand their presence in the country, recovering from this year's weak sales caused by the ban of Audi and Volkswagen cars, with their market share reaching a record high of 13.9 percent next year, the report predicted.

The report said global auto demand for next year is estimated at 90.42 million, up 2.1 percent from this year's estimated 88.53 million, marking the slowest growth since 2008 when the global economy rocked by the Lehman Brothers debacle.

Auto demand in India and Russia is expected to improve next year, while auto sales in Europe and the US will likely remain flat. Auto sales in China, the world's largest auto market, will face a slowdown next year, it said. (Yonhap)