Korean automakers eye Bangladesh market
Korean automobile manufacturers are looking to increase their market share in Bangladesh after sales of their cars rose 20 percent on an average in the last three years, said industry people.
The share of Korean automakers in the Bangladesh market reached 6 percent in 2017, showed an analysis of data from Bangladesh Road Transport Authority (BRTA) and local agents.
Korean automobiles companies are increasing their market share in the segment along with electronic products, said Shahab Uddin Khan, adviser of the Korean Bangladesh Chamber of Commerce and Industry.
"Korean automobile retailers only import brand new cars and their prices are affordable compared to those of other globally reputed companies,” he said.
He also said clients who do not mind spending for cars prefer Korean brands thanks to their elegant and modern designs and affordable prices.
A total of 1,350 units of cars were sold in Bangladesh in 2017, up from 1,160 units in 2016 and 1,010 units in 2015, data from the local agents of Korean car retailers showed.
Last year, the BRTA registered 21,959 cars, which were 20,304 units in 2016 and 21,062 units in 2015.
There is a huge demand for cars riding on the section becoming increasingly affluent in the country while car sales are forecast to amount to as much as $2.5 billion a year, according to Bangladesh Investment Development Authority. Boston Consulting Group, an American multinational management consulting firm, says two million Bangladeshis join the ranks of the middle and affluent class every year.
The demand for cars is forecast to grow at a rate of 20 percent year-on-year in the next few years, said Farzana Khan, deputy director for sales of Hyundai Motors Bangladesh Ltd. As a result, the market size of cars will grow, she said.
She said Hyundai's car sales rose 20 percent on an average annually in the last three years and it acquired 5 percent of the market share.
The auto-maker has introduced nine models of cars in Bangladesh. Of them, two are sport utility vehicles, three sedans, two hatchbacks, and two microbuses.
“Hyundai is very keen to increase its market share,” said Khan. The manufacturer set up an assembly plant at Kalurghat in Chattogram at a cost of Tk 250 crore in 2013.
“Basically we wanted to establish the plant in a bid to provide cars to customers at an affordable price and increase the market share.”
Hyundai plans to assemble all models at the Kalurghat plant within the next two years and go for manufacturing in the same plant within five years.
It would also set up service centres in all 64 district headquarters within five years.
Md Shafiqul Islam, additional general manger of Meghna Automobiles Ltd, the sole distributor of KIA, a Korean automobiles company, said KIA was trying to gain a sizeable market share in the country.
It sold 150 cars in 2017, 70 units in 2016 and 160 units in 2015.