French Automakers Accuse South Koreans of Unfair Competition

French automakers PSAPeugeotFrance, 1882 > present120 models
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and RenaultRenaultFrance, 1898 > present189 models
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continue to criticize the free trade agreement between the EU and South Korea. The latest row deals with allegations from PSA and Renault that HyundaiHyundaiRepublic of Korea, 1967 > present79 models
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and KiaKiaRepublic of Korea, 1944 > present52 models
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are selling cars in France at below cost to take a bite into the French automakers' market share while they are weakened. French Industry Minister Arnaud Montebourg is investigating the allegations.

The French automakers are already pressuring the government to pressure the EU Commission to cancel the free trade agreement because it is harming their business. 

Montebourg appears to already have his mind made up on the issue. He said during a government meeting: “Hyundai and Kia are unfairly competing against [French carmakers] by engaging in dumping, which is unacceptable."

Dumping refers to the allegations of Kia and Hyundai selling cars at below market value. 

“The success of Hyundai in Europe is based on products designed, engineered and built in Europe. Our most popular, and fuel-efficient, models sold in France are built at our European factories in the Czech Republic and Turkey. In fact, nearly 90 percent of the Hyundai cars registered in Europe during the first half of 2012 were built outside of Korea," said Hyundai Europe COO Allan Rushforth.

Hyundai and Kia have seen double-digit sales increases in France this year, while PSA and Renault sales have fallen. Still, Hyundai has sold only about 10% of the cars that PSA has in France this year. 

Source: Automotive News Europe