The growing popularity of newly launched full-sized hybrid cars with high-end amenities and good fuel economy has increased sales of overall hybrid cars in South Korea, industry sources say.
Combined sales of hybrid cars made by Hyundai Motor Co and Kia Motors Corp hit 2982 units in February, up almost two-fold from 1507 vehicles sold a year earlier, the sources said.
The numbers are not as high as the record 3511 hybrid cars sold by the two companies in December 2012, yet they represent a solid rebound in sales.
The increase has been triggered by demand for the Grandeur and K7 hybrids, which were unveiled late last year. The two cars augmented the rather staid lineup of the Sonata and K5 models that have been offered since 2011 with the electric motor-combustion engine combination.
The Grandeur and K7 are known in overseas markets such as the United States as the Azera and Cadenza, respectively.
In particular, demand for the Grandeur shot up to 1156 units in January with 1578 sold the following month. Among locally made hybrid cars, the Grandeur model accounted for 52.9 per cent of the total last month.
Related to the popularity of hybrid cars, business insiders said people are drawn to good fuel economy of these vehicles that offer the same level of comfort as their pure combustion-engined siblings.
"In the past people were satisfied with the various amenities offered by full-sized cars but were reluctant to buy them because of their mediocre mileage," an official from Hyundai said. He claimed this has changed with the introduction of hybrids.
In addition, the lowering of prices and tax benefits have made hybrid cars more affordable.
Car dealerships said the Grandeur hybrid with a fuel economy of 16 kilometres per litre cost 34.6 million won (A$36,032). This is only 380,000 won more expensive than the Grandeur 3.0-litre Exclusive model that has a rated fuel economy of 10.4km/l.
Industry experts said that with fuel prices remaining high, demand for cars with good mileage will continue to be strong, which could cause competition to heat up.
They said competition to win over consumers is expected to be very fierce this year as Japanese carmakers are expected to release new hybrid models in South Korea, while German companies will step up efforts to sell more of their economic diesel vehicles that have generated a strong following in the country in recent years.