Navistar to heat up Korea’s truck market

[kscarbel2]

The Korea Herald / February 16, 2014

Navistar International released its signature ProStar commercial trucks in Korea on Wednesday, becoming the first U.S. truck maker to enter the market since the Korea-U.S. Free Trade Agreement went into effect in March 2012.

The International ProStar is a 6-by-4 with 475 horsepower and 235 kilograms per meter of torque. Aerodynamics contribute to 50 percent of overall fuel economy, which makes it critical for a vehicle to be designed to minimize drag, Navistar said, adding that the vehicle’s aerodynamic nose and other components make it one of the most fuel efficient vehicles in the truck industry.

More than 70,000 units of the model have been sold in the U.S., and the company expects the 159 million won ($150,000) vehicle to create $5 million in profit in Korea this year.

U.S. Ambassador to Korea Sung Kim (left) shakes hands with Tom Clevinger, senior vice president and general manager of Navistar’s global export operations, at the Grand Hyatt Seoul Hotel. (Navistar)

“In the U.S., the ProStar was used as a benchmark for developing aerodynamic standards. Under the free trade agreement, Korean truck drivers will now be able to experience the cost savings associated with the improved aerodynamics and fuel efficiency of aero-nosed on-road commercial trucks,” said Tom Clevinger, senior vice president and general manager of Navistar’s global export operations at a press conference in Seoul last week.

The arrival of ProStar is expected to create a stir in the heavy load truck market, of which 55 percent is dominated by European vehicles such as Daimler AG, Skania, Volvo and MAN. Domestic players include Hyundai and Tata Daewoo.

The imported truck market has shown steady growth. According to the Korea Customs Office, $129 million worth of trucks were imported to Korea in 2009 and imports jumped to $213 million in 2013, a 64 percent increase.

Korea’s free trade agreements with the European Union and the U.S. are expected to improve their competitiveness due to the lowered tariffs. The current 1.6 percent and 4 percent tariffs on European and U.S. cars will be scrapped from July and 2016, respectively.

Clevinger said that Navistar products have 9 percent higher fuel efficiency than their European competitors.

[DailyDiesel]

Interesting indeed. I suppose this free trade agreement reduces or eliminates the need to have a domestic partner based in Korea? Too bad the ProStar originates from a Mexican factory so it's hard to call this a true American export. It will be interesting to see how a conventional model takes to a country used to the cabover model.