Automobile Industry Association "Welcomes Signature Campaign for Full Opening of Used Car Market" Support Declaration

"Market Expansion and Consumer Rights Protection Possible"

[Image source=Yonhap News]

[Asia Economy Reporter Yu Je-hoon] The Korea Automobile Industry Association (KAIA) announced on the 22nd that it supports the consumer group Transportation Solidarity's "Petition Campaign for the Complete Opening of the Used Car Market." Transportation Solidarity is a coalition of consumer organizations including the Citizens' Transportation Safety Association and the Citizens' Union for Driving Cars for 10 Years.

According to KAIA, the domestic used car market, where the entry of finished car manufacturers is currently restricted, is only 1.2 times the size of the new car market. This contrasts with the United States and Germany, where finished car manufacturers can freely enter the market, and the used car market is 2.2 to 2.4 times larger than the new car market.

Accordingly, KAIA expects that if finished car manufacturers enter the market, the characteristic of the used car market as a "person-to-person transaction" will shift to "market transactions," potentially expanding the overall market size to more than twice its current scale.

KAIA stated, "If the market expands, it will reduce opportunistic behaviors by the existing used car trading industry that exploit consumers' lack of information, and enhance the industry's self-regulation and innovation efforts," adding, "It is also expected to improve transaction safety and reliability, thereby promoting consumer rights."

In fact, a recent survey conducted by the Consumer Sovereignty Citizens' Meeting on the entry of finished car manufacturers into the used car market, targeting 254 experts, showed that 79.9% gave a "positive" evaluation.

Jung Man-ki, chairman of KAIA, said, "Since the designation of the used car sales business as a livelihood-type suitable industry in 2019, the Fair Trade Commission issued an unfavorable opinion, but the related procedures have been delayed, which is regrettable," adding, "Considering the positive effects such as resolving reverse discrimination against imported cars, strengthening consumer rights, and providing expanded business opportunities to the existing used car industry, measures to allow finished car manufacturers to participate in the used car trading market should be implemented promptly."