KOTRA signed a memorandum of understanding (MOU) with Hyundai Motor (005380.KS) and Kia (000270.KS) on the 8th to support Korean parts suppliers' expansion into overseas markets, the state-run trade promotion agency said the following day.
Auto parts are a key intermediate good, ranking sixth among Korea's 15 major export items. However, auto parts exports have been declining since 2023 amid shifts in the global trade environment, including geopolitical risks such as the Russia-Ukraine war and expanding localization. Last year, Korea's automobile exports reached $72 billion (approximately 108.1584 trillion won), succeeding in diversifying into markets such as Europe despite U.S. tariff measures. Auto parts exports, however, fell 6% year-on-year to $21 billion (approximately 31.5462 trillion won). Exports in the first half of this year also came to $10 billion (approximately 15.032 trillion won), down 6.3% from a year earlier.
In response, KOTRA will join Hyundai Motor and Kia in direct on-site parts sales efforts targeting foreign automakers to help Korean auto parts companies open new sales channels. As the first joint project under the agreement, KOTRA, Hyundai Motor and Kia will hold "Ford-Korea Parts Suppliers Day" in Detroit on the 14th. The "Stellantis Innovation Tech Show" will follow on the 16th.
A total of 44 top-performing parts suppliers of Hyundai Motor and Kia, selected by Ford and Stellantis, will participate in the planned events.
KOTRA also plans to hold a briefing on U.S. automakers' purchasing policies to help Korean parts suppliers formulate strategies for entering the U.S. market.
"This MOU with Hyundai Motor and Kia carries great significance in that it combines the companies' global networks with our overseas marketing support functions to create a model case of shared growth between large companies and SMEs," said Kang Kyung-sung, President and CEO of KOTRA. "To expand exports for auto parts companies facing difficulties, KOTRA will create supply chain entry opportunities in Europe, Japan and elsewhere in the second half of the year and further strengthen its support."
