Automotive Industry Urges Expedited SME Ministry Review Process to Allow Used Car Transactions
[Asia Economy Reporter Changhwan Lee] The automotive industry has urged the government to expedite the related procedures so that used car sales businesses can operate promptly.
The Korea Automobile Industry Association (KAIA), composed of nine organizations including the Korea Automobile Industry Association, Hyundai-Kia Cooperation Association, and Korea GM Cooperation Association, announced on the 30th that it has requested the Ministry of SMEs and Startups to promptly proceed with the review process for designating used car sales as a livelihood-type suitable business.
KAIA emphasized, "Livelihood-type suitable businesses must complete the review within a maximum of 15 months from the application date, but the used car sales business has been pending for over two years since the application in February 2019, and more than 1 year and 4 months have passed since the legal deadline (May last year)."
Used car sales businesses were designated as suitable businesses for small and medium enterprises in 2013, restricting new entries and expansions by large corporations. However, in November 2019, the Win-Win Growth Committee judged that considering consumer welfare and the declining market share of large corporations, it was inappropriate to designate it as a livelihood-type suitable business.
Since then, the completed car and used car industries launched the "Used Car Sales Industry Development Council" in June under the leadership of the Democratic Party's Euljiro Committee and held several meetings, but ultimately failed to reach an agreement.
KAIA stressed, "Now is the time for a review committee composed of private experts to fairly and objectively determine whether the used car sales business should be designated as a livelihood-type suitable business."
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Jung Manki, chairman of KAIA, said, "When completed car manufacturers enter the used car trading market, the replacement of defective parts in used vehicles will increase vehicle safety, alleviating consumers' concerns about purchasing used cars and reducing safety accidents," adding, "consumer trust in the overall used car market will increase, and the market size will grow to more than twice its current scale."
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