Hyundai Motor Also Enters Used Car Market? Opposition from Labor Union: "Focus on Future Vehicle Capabilities" "Consumer Burden"

Assemblyman Jo Jung-hoon of the Shift Era./Photo by Hyunmin Kim kimhyun81@

[Asia Economy Reporter Park Cheol-eung] Democratic Party lawmakers are voicing criticism and concerns over Hyundai Motor's entry into the used car market. They point out that price and volume controls could actually increase the burden on consumers.

On the 8th, Lee Su-jin, a Democratic Party lawmaker representing Dongjak-eul, Seoul, stated at the Ministry of SMEs and Startups audit, “The participation of large corporations in the used car sales business is squeezing small businesses,” urging the designation of the used car sales industry as a livelihood-type suitable industry. She emphasized that large corporations should focus their capabilities on the future car market as global leading companies.

The designation of a “livelihood-type suitable industry” is a system that prevents large corporations from entering industries or product categories dominated by small merchants and business operators, in response to indiscriminate business expansion by large corporations.

In February last year, an application was made to designate the used car sales business as a livelihood-type suitable industry. In November of the same year, the Commission for Shared Growth reportedly submitted an opinion that the used car sales business has low vulnerability and low need for protection, and considering consumer welfare, it is inappropriate to designate it as a livelihood-type suitable industry.

According to data submitted by the Korea Automobile Dealers Association Federation, Lee said that over the past three years, the average annual sales volume of used car dealers was 1.15 million units, with a total of about 38,000 sales employees. This contradicts the Commission for Shared Growth’s claim that the average monthly sales per salesperson is only 2.5 units, indicating low vulnerability.

Additionally, data from the Korea Consumer Agency shows that the number of damages related to used car transactions has significantly decreased from 300 cases in 2016 to 82 cases as of August this year.

Lee argued, “Currently, there is no basis for not designating the used car sales business as a livelihood-type suitable industry in terms of vulnerability, consumer welfare, and protection needs,” and insisted, “A fair review based on clear grounds should be promptly conducted for the designation of the used car sales business as a livelihood-type suitable industry.”

She added, “Since Hyundai Motor has participated as a large corporation member on the Commission for Shared Growth from its inception to the present, the Commission’s opposing opinion has been compromised in fairness from the start,” and said, “Large corporations should focus their capabilities on future cars, not used cars.”

Jo Jeong-hoon, a member of the Industry, Trade, and SMEs Committee from the Transition Era party, also told Park Young-sun, Minister of SMEs and Startups, that “The entry of finished car manufacturers like Hyundai and Kia into the used car sales market will be the fuse for ‘large corporation employee-ization.’”

According to data from the Ministry of Land, Infrastructure and Transport’s Statistics Nuri, over the past five years, the number of used car dealers increased by 16.3%, and the number of sales employees increased by 7.18%, while the monthly transaction volume per dealer and per employee slightly decreased.

He also pointed out that if large corporations enter the used car sales market, it cannot be ruled out that they might control sales volume as a means to defend against brand value decline due to increased market dominance.

Jo said, “We need to distinguish between criminal groups committing used car fraud and regular sales workers,” and urged, “Minister Park Young-sun and the Ministry of SMEs and Startups should take an inclusive stance to prevent large corporation employee-ization and protect small business owners, so that the majority of our people can become ‘bosses’ in a healthy nation.”

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