South Korea ranked seventh in global automobile production in 2024, slipping further down the rankings as domestic output declined while overseas production by its automakers expanded.
According to the Korea Automobile & Mobility Association (KAMA), South Korea produced 4,128,242 vehicles in 2024, down 2.7% from the previous year. It was the country’s lowest ranking since 2019, when it also placed seventh. The figure excludes overseas production by Hyundai Motor and Kia, two of the world’s top three automakers by volume.
South Korea had briefly climbed to fifth place in 2020 as the COVID-19 pandemic disrupted global supply chains, but it fell to sixth in 2022 as Germany rebounded and dropped further in 2024, overtaken by Mexico, which produced 4.2 million vehicles. Domestic production fell 6.5% to 1,635,520 units, the lowest level since 2013, while export growth slowed to below 1%.
South Korea’s auto industry peaked in the early 2010s, when production surpassed 4.5 million units annually. In 2011, the country produced a record 4.66 million vehicles as exports hit an all-time high of 3.15 million. But as domestic automakers expanded overseas, local production declined. By 2024, exports had fallen to 2.78 million units.
Meanwhile, overseas manufacturing has steadily grown. Hyundai’s Czech plant, which had an annual capacity of 230,000 vehicles in 2011, now produces 330,000. Its India facility expanded from 600,000 to 750,000 units, while its Turkey plant more than doubled capacity to 220,000. Kia has also increased production at its plants in Slovakia and Georgia, while its Mexico and India facilities, both operational since the late 2010s, have a combined annual capacity of nearly 800,000 units.
Hyundai’s new Metaplant in Georgia, which began operations in October 2024 with an annual capacity of 300,000 vehicles, has raised further concerns about the future of domestic production.
South Korea’s auto sector faces growing pressure from U.S. tariffs on imported vehicles, a move expected to hit exports and further weaken domestic production. Industry analysts warn that if automakers continue shifting production overseas while facing increased competition from China, South Korea could struggle to maintain its place among the world’s top 10 auto-producing nations.
“The country’s major auto plants were built before the 1997 Asian financial crisis,” said Cho Chul, a senior researcher at the Korea Institute for Industrial Economics & Trade (KIET). “Korea GM’s Changwon plant resumed full operations in 2023, bringing total domestic production back to 4 million units, but the outlook remains uncertain.”
Korea GM, which exports 95% of its vehicles, is particularly vulnerable to U.S. trade policies. The company produced nearly 500,000 vehicles in 2024, focusing on small cars for General Motors, but analysts warn that new U.S. tariffs under President Donald Trump’s administration could significantly impact its operations.
High labor costs and South Korea’s 52-hour workweek policy add to the industry’s challenges. “In the short term, tariffs will put additional pressure on automakers, while in the long run, China’s growing influence in developed markets like the EU will further impact production,” said Lee Hang-gu, a researcher at the Korea Automotive Technology Institute (Katech). “If overseas production continues expanding, small parts suppliers that depend on domestic manufacturing could also face serious risks.”
