Overseas Sales of Top 100 Companies Plunge 20% Due to COVID-19 Impact

Source: Federation of Korean Industries

[Asia Economy Reporter Changhwan Lee] Due to the impact of the novel coronavirus infection (COVID-19), overseas sales of Korea's top 100 companies in the second quarter sharply declined by nearly 20% compared to the same period last year.

According to the Federation of Korean Industries on the 7th, overseas sales of the top 100 domestic companies in the second quarter recorded 146.3 trillion won, down 19.8% from the same period last year.

All three major industries?electric and electronics, automobiles and automobile parts, and energy and chemicals?could not avoid poor overseas sales. Despite the spread of untact culture such as remote work and online education after COVID-19, the electric and electronics sector showed 71 trillion won, a 5.1% decrease compared to the same period last year.

The automobile and automobile parts sector suffered a direct hit from the suspension of global production lines of major automakers such as Volkswagen, BMW, Mercedes-Benz, and Audi, as well as a sharp decline in global demand, resulting in a 36.5% plunge. The energy and chemical sector also decreased by 30.9% due to weak refining margins continuing since last year, a sharp drop in international oil prices, and a rapid decline in overseas demand caused by the spread of COVID-19.

Looking at the overseas sales decline rate by major industry, the steel industry showed the highest decline rate with an 80.1% decrease in overseas sales as demand for high-profit steel products such as automotive steel sheets sharply dropped due to sluggish global automobile sales. This was followed by the automobile and automobile parts, and energy and chemical sectors, which also showed high overseas sales decline rates.

By region, Asia decreased by 24.0%, the Americas by 12.6%, and Europe by 11.2%. This is the result of aggregating the continental sales performance of the top 20 companies that disclose overseas sales performance by region and country among the top 100 companies by sales.

However, the China sales of the five major companies?Samsung Electronics, Hyundai Motor, LG Electronics, SK Hynix, and Hyundai Mobis?that disclose China sales increased by 5.9% year-on-year and 19.6% quarter-on-quarter.

This is attributed to the rapid recovery of the Chinese economy in the second quarter after investment, consumption, and production hit their lowest points in February and March, with a real growth rate of 3.2%, and the increase in demand for related products due to the expansion of new infrastructure investments such as 5G, AI, and the Internet of Things at the Two Sessions held on May 21.

Kim Bong-man, head of international cooperation at the Federation of Korean Industries, emphasized, "Although the US, Germany, and Japan poured massive fiscal resources in the second quarter, there are no signs of economic recovery, and the global business environment for companies is more difficult than during the IMF foreign exchange crisis and the global financial crisis," adding, "External policies that can support our companies operating overseas, such as expanding special entry for key trading and investment countries of businesspeople and active cooperation with local governments, are urgently needed."

This content was produced with the assistance of AI translation services.