Monday, August 24, 2009

Korea's "City Car" Market

I study the Korean car market. Over the past years, I have documented and discussed Korea's march up market. That said, there is still strong demand in Korea for sub compacts, which are not part of the line up in many nations including the United States. The GM Daewoo Maitz Creative super mini shown above and noted below is based on the Chevy Spark.

This Korea Herald article shares much on entry level sector in Korea.

GM Daewoo has had free rein over Korea's city car market for several years with the Matiz becoming something of an icon in the field. Its dominance partly resulted from Hyundai Motor Co.'s discontinuance of its city car Atoz in 2003 and Kia Motors Corp.'s Morning car only being included last year.

That changed last year when the limit on city cars' engine displacement was raised to 1 liter, bringing Kia Motors Corp.'s Morning into the same segment.

The Matiz was quickly pushed off its throne as Morning sales soared.

The Morning wooed motorists with its larger engine - 1-liter, as opposed to the Matiz Classic's 800 cubic centimeters - resulting in sales almost tripling from the previous year to more than 84,000 units. This was about 34,000 units higher than 50,126 units of the Matiz Classic sold last year.

However, the competition for the top spot in the city car segment is back on with GM Daewoo rolling out the new Matiz Creative.

The Matiz Creative is fitted with a 1-liter engine, putting in on the level with the Morning.

Although the two are matched in terms of engine displacement, the Morning is slightly ahead in terms of power output, with 72-brake horsepower to the Matiz Creative's 70.

Power output may not be at the top of the list of things a motorist is looking for in a city car, but the Matiz Creative also trails the Morning in terms of fuel economy.

The Morning, fitted with four-speed automatic transmission, manages 17.4 kilometers per liter of fuel while the similarly equipped Matiz Creative manages 17 kilometers on a liter.

The Matiz Creative will only be available with automatic transmission until early next year when GM Daewoo will be adding manual transmission to the lineup.

Another edge Kia has over GM Daewoo is that it offers a version of the Morning fitted with a liquefied petroleum gas engine. Although the LPG engine is less fuel efficient, the fuel is cheaper allowing motorists to cut running costs.

The Kia Morning is also a step ahead in prices.

The most basic trim of the Morning, fitted with four-speed automatic transmission is 8.31 million won ($6,650), 7.06 million won and 1.25 million won for automatic transmission.

The most expensive trim, the SLX Special, is priced at 9.77 million won.

By comparison, the Matiz Creative starts at 9.06 million won and goes up to 10.89 million won, making GM Daewoo's new city car is at least 700,000 won more expensive than the Morning.

However, the Matiz Creative does have its advantages. At 3,595 millimeters long, 1,520 millimeters high and 1,595 millimeters wide, GM Daewoo's new car is larger than the Morning.

In addition, the Matiz Creative is likely to offer better protection to its passengers. According to company, the car was developed with the aim of receiving a minimum of four-star ratings in new car assessment programs in the United States, Europe and in Korea.

To this end, the company built 66.5 percent of the car's body using high- or ultra high-strength steel to give it higher structural integrity. Ultra high-strength steel is used in the sides of the vehicle to minimize damage in side-on collisions and the rear of the vehicle is protected with high strength steel. The engine compartment has been made larger to prevent the engine being pushed into the cabin in front-on collisions. The crumple zone of the steering column was increased to 70 millimeters and the roof of the vehicle has been designed to withstand up to four times the weight of the car. The local standard for roof integrity is 1.5 times that of the car's weight.

The Matiz Creative is also the first vehicle in its segment to be fitted with curtain airbags.

If the company's aims are achieved, the Matiz Creative will have at least a star over the Morning, which received a three-star rating in the Euro New Car Assessment Program.

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