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SOURCE: USDOC, International Trade Administration
SOURCE KEY: IT
PROGRAM KEY: IT MARKET
PROGRAM: Market Research Reports
UPDATE: Monthly
ID NUMBER: IT MARKET 111103415
TITLE: KOREA - OUTBOARD MOTORS & SPORTING BOATS - ISA9209
DATA TYPE: TEXT
END YEAR: 1992
UPDATED: 12/17/92
KEYWORDS 1:
| 9209
| BEST|PROSPECTS
| CC580
| COMPETITION
| DISTRIBUTION
| END|USERS
| ISA
| ISA9209
| KOREA
| MARKET|ACCESS
| MARKET|ASSESSMENT
| OUTBOARD|MOTORS
| SPORTING AND RECREATION GOODS
| SPORTING|BOATS
| SPORTING|GOODS
| SPT
| STATISTICS
| TRADE|CONTACTS
| TRADE|PROMOTION
COUNTRY:
| KOREA
| SOUTH KOREA
| ASIA
| EAP
| EAST ASIA
| EAST ASIA & PACIFIC
| EAST ASIAN COUNTRIES
| EAST ASIAN GROUP
| FAR EAST
| FAR EASTERN COUNTRIES
| FAR EASTERN GROUP
| NEWLY INDUSTRALIZED COUNTRIES
| NICS
| PACIFIC
| PACIFIC RIM
| PACIFIC RIM COUNTRIES
| PACIFIC RIM GROUP
TEXT
KOREA - OUTBOARD MOTORS & SPORTING BOATS - ISA9209
SUMMARY
This article is derived from a report titled: "The Outboard Motors &
Sporting Boats Market in Korea", dated September 1992, prepared by Sung In
Cho, American Embassy - Seoul. This article consists of 05 pages and
contains the following subtopics:
OVERVIEW
STATISTICAL DATA
MARKET ASSESSMENT
BEST SALES PROSPECTS
COMPETITIVE SITUATION
MARKET ACCESS
TRADE PROMOTION OPPORTUNITIES
OVERVIEW
Growing per capita income and interest in leisure activities has increased
the Korean demand for sporting equipment 10 to 15 percent over the past
three to four years. Sporting boats which include inflatables, canoes,
yachts, motor boats, FRP boats, pedal boats and oar boats, among others, are
a relatively undeveloped industry and considered as luxury items. Although
Korea is a peninsula with obvious potential for pleasure/sporting boats, the
local seashores available for water sports are extremely restricted by
military zones. As for inland facilities, some 20 lakes and rivers are
available. The major sites for sporting boats include the Han River, which
crosses in the middle of Seoul area, Chung Pyung Lake, Kyunggi-do which is
one of the largest resort areas in Korea and the seashores adjacent to
important port cities including Pusan, Incheon and Kang Reung. The market
for sporting boats has an estimated value of some USD 10 million and will
increase 10 - 15 percent annually for the next three years. The demand for
outboard motors is estimated to increase some 20 percent per year due to the
growing demand for sporting boats, official guard ships and commercial boats
such as rental boats for amusement parks and fishing.
While Korea is one of the most important worldwide shipbuilding exporters,
local manufacturing of sporting boats is relatively undeveloped and some 120
related small firms produce inflatables and FRP boats on an order basis.
Imports for sporting boats from the U.S.A. ranked first with USD 892
thousand for 1991 and will increase some 15 percent for the next two-three
years. For outboard motors, the market is wholly supplied by imported
goods, wiht U.S. and Japanese products leading in market acceptance.
B. STATISTICAL DATA: Outboard Motors and Sporting Boats
(USD Million) (Percent)
Previous Last Current Est.Avg.Annual
Year Year Year Real Growth -
1990 1991 1992 Next 3 Years
Import Market 5.9 6.1 7.6 20
Local Production 12 11 10
Exports 8.1 5.3 4
Total Market 10 12 13.6 15
Imports from U.S. 3.4 2.9 3.5 15
Exchange Rates 708 733 780
Future Inflation Rate Assumed: 9 percent
Last Year's Import Market Share (Percent for USA and Major Competitors):
U.S.: 48 percent Japan: 38 Germany: 3 U.K.: 2
Receptivity Score (1-5): 4
5 = extremely receptive
4 = very receptive
3 = fairly receptive
2 = somewhat receptive
1 = not receptive
C. MARKET ASSESSMENT
The facilities for sporting boats are located at some 20 lakes/rivers and
seashores adjacent to important port cities including Pusan, Incheon and
Kang Reung. The major sites include Hangang Misari Park, Seoul; Tancheon,
Kangwon-do; Sooyoung Yachting Center, Pusan; Yeochun Yachting Center,
Chunnam; and Sachun Jinri Yachting Center, Kangwon-do.
According to sporting boats associations, there are no professionals in
Korea, but the number of amateurs for sporting boats including row boats,
yachts and canoes is estimated at some 2,000. The popularity of sporting
boats, along with water skiing, continues to increase. However, this sport
is still being introduced and has the image of an unfamiliar, special
sport. The following are official sporting boat events in Korea.
SPORTING BOAT PERIOD SPONSORED BY
Row Boats 1. the beginning of May Chief of
Naval Operation
2. the end of May, the Korean Amateur Rowing
Summer tournament Association (KARA)
3. July ROK President
4. the end of August Minister of the Ministry
of Sports & Youth (MOS)
5. the end of August, KARA
Championship contest
6. October National Athletic Meeting
Yachts 1. March - April the Korea Yachting
Spring game Association (KYA)
2. May ROK President
3. July KYA
Summer game
4. August University Yachting
Tournament
5. October National Athletic Meeting
Canoes 1. before June Chairman of the Korean
Canoe Federation
2. June - July Chief of Naval
Operation
3. August - September Minister of MOS
4. October National Athletic Meeting
D. BEST PROSPECTS
HS Code: Product Description:
8903.10 Inflatables
8903.92 Motor boats other than outboard
motorboats
8407.21 Outboard motors
E. COMPETITVE SITUATION
OUTBOARD MOTORS:
Imports of outboard motors for 1991 were USD 4.2 million, 17 percent
increase over 1990, and will grow some 20 percent on an annual basis for the
next three-four years. Foreign brands which are found in the local market
include Evinrude, Johnson, Sea Drive, Mariner, Mercruiser, Yamaha, Suzuki,
Dohatsu, Nissan, and Honda among others. According to local business,
Yamaha occupies some 50 percent of the total market share and Japanese
products are considered to be competitive in price, service, promotional
gifts and quality control. Imports from Japan increased some 70 percent
between 1990 - 1991.
In this market, local products are hardly found. Korea Mighty Co., Ltd.
(120-1, Pyungsan-ri, Woongsang-myun, Yangsan-kun, Kyungnam Tel:
82/2/556-1793 Fax; 82/2/556-2317) is the only outboard motor manufacturer
and exporter.
SPORTING BOATS:
Although HS 8903 is classified as an item for promotion and development of
local manufacturing by the government, domestic production decreased some 10
percent and exports decreased some 35 percent between 1990 - 91. According
to the Korea Shipbuilding Industry Cooperative, there are some 120 small
manufacturers of inflatables and FRP boats in this field, and about 40
percent of manufactured goods are supplied to the local market. For 1991,
Korean manufacturers exported USD 4.4 million worth of inflatables, which
accounted for 84 percent of the total export. The production of motor boats
nearly stopped due to discouraging sales during the late seventies. Large
shipbuilders which are worldwide manufacturers for cruise, ferry, barge,
cargo and specialty transportation ships recently attempted to produce
sporting motor boats, however, this field remains unpromising for them.
Important local manufacturers/exporters for inflatables and FRP boats
include Dongyang Co. (FRP mira boat), Korea Mighty Co. (PVC inflatable),
Woosung I.B. Co. (inflatables with Xebec brand), Acimex Corp. (PVC
infaltables), Victory Boat (FRP and inflatabls), and Hwashin FRP Co..
For 1990, U.S. sporting boats represented some 60 percent of the total
imports and 50 percent for 1991. Imports from Japan, Germany, PRC, Canada ,
U.K. and others share the remaining market. Imports from Germany, U.K. and
Hungary are mainly competition boats including yachts, canoes and row boats.
Among U.S. boats, Sea Eagle, Sea Rail, Sea Hawk, Hovercraft Scat, and OMC's
(Outboard Marine Corporation) products including Chris Craft, Donzi, Cobra,
King Cobra, Seaswirl, Stratos and Sunbird are found in the local market.
U.S. products are expected to enjoy an overwhelming market share for the
time being due to quality and reputation.
F. MARKET ACCESS
Before importation, inflatables are subject to mandatory inspection by the
Industrial Advancement Administration (IAA). The import duty rate for
outboard motors and sporting boats is 11 percent of CIF price for 1992 and
is expected to decrease to 9 percent for 1993. Local taxes are assessed as
follows: 30 percent for the special excise tax; 30 percent for the
educational tax; and 10 percent for value-added tax. Thus, a total of 42.9
percent in local taxes is imposed on these products.
According to a local business in a related field, import commission earnings
are about 15 percent and distribution margins are around 10 percent, which
is not considered to be a high profit business.
KEY CONTACTS
Korea Shipbuilding Industry Cooporative
91514, Pangbae-dong, Seocho-ku
Seoul 137-060
Tel: 82/2/587-3121 through 3 Fax: 82/2/583-2922
Korea Marine Equipment Association
12-5, Yoido-dong, Youngdeungpo-ku
Seoul 150-010
Tel: 82/2/783-6952 Fax: 82/2/785-7647
Association of Foreign Trading Agents of Korea
Aftak Bldg, 218, Hangangro 2-ka, Yongsan-ku
Seoul 140-012
Tel: 82/2/792-1581 through 4 Fax: 82/2/785-4373
Korea Foreign Traders' Association
159-1, Trade Center Bldg.,
159-1, Samsung-dong, Kangnam-ku
Seoul 135-757
Tel: 82/2/551-5114 Fax: 82/2/551-5100, 5200
Korean Amateur Rowing Association
Rm. 410, Olympic Bldg.,
88, Oryun-dong, Songpa-ku
Seoul 138-749
Tel: 82/2/420-4275 Fax: 82/2/420-4276
Korean Yachting Association
Rm. 1807, Daewoo Bldg.,
Namdaemun-ro 5-ka, Chung-ku
Seoul 100-095
Tel: 82/2/777-1510 Fax: 82/2/773-8660
Korean Canoe Federation
Rm. 608, Olympic Bldg.,
88, Oryun-dong, Songpa-ku
Seoul 138-749
Tel: 82/2/420-4282 Fax: 82/2/420-4283
Saehan Johnson Co., Ltd.
Rm. 108, Daewoong Bldg.,
617-2, Shinsa-dong, Kangnam-ku
Seoul 135-120
Tel: 82/2/542-6363 Fax: 82/2/546-1951
G. TRADE PROMOTION OPPORTUNITIES
SPOKOR.BOAT SHOW (Korea International Sports, Leisure and Boat Show) at the
Korea Exhibition Center (KOEX) run by KOEX, International Exhibition
Promotion Co., Ltd. (INTEREX) and the Hankook Ilbo and the Daily Sports
should help promote U.S. products among Korean users. SPOKOR.BOAT SHOW,
held annually in June, is sponsored by the Ministry of Sports & Youth (MOS),
the Ministry of Trade & Industry (MTI), the Korea Amateur Sports Association
(KASA), the Korea Foreign Trade Association (KFTA), the Korea Chamber of
Commerce & Industry (KCCI), the Korea Federation of Small Business (KFSB),
the Korea Trade Promotion Corporation (KOTRA) and the Korea Sporting
Industry Coorperative (KSGIC).
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