The French government has accused Hyundai and Kia of dumping practices.
French Industry Minister Arnaud Montebourg said the Korean carmaker’s pricing policy is hurting local automakers like Renault and PSA/Peugeot-Citroen, which have been losing sales and market share in their home market.
Montebourg went on and asked the European Commission to investigate the legality of the Hyundai Group’s strategy in France and Europe, as the EU and South Korea have signed recently a free trade agreement. According to the French official, the Hyundai Group, which owns Hyundai Motor Company and Kia Motors Corporation, prices its cars below market value, thus gaining unfair market share in France and Europe.
“Hyundai and Kia are unfairly competing against French carmakers by engaging in dumping, which is unacceptable,” Montebourg was quoted as saying by Automotive News.
Hyundai rejected the accusation, with a company spokesman telling Automotive News that the average price discount offered by carmakers in the EU during the first half of 2012 was 2,137 euros, while Hyundai’s price incentive was 88 percent of that average, or 1,870 euros.
“The success of Hyundai in Europe is based on products designed, engineered and built in Europe,” said Hyundai Europe CEO Allan Rushforth. “Our most popular, and fuel-efficient, models sold in France are built at our European factories in the Czech Republic and Turkey,” he added.