Unlocking South Korea:ZZS Motor Scooters: Unlocking South Korea: ZZS Motor Scooters Sandra Olson August 26, 2007


Product: Product Figure 1 – Collateral sample from Vectrix. Reproduction of collateral. Permission to use for educational purposes pending.


South Korea: South Korea GDP Growth Rate - 4.3% (CIA World Fact Book, 2007) GNP Per Capita - $16K (U.S. Dept of State, 2007) Unemployment - 3.3% (CIA World Fact Book, 2007) Inflation - 2.7% (CIA World Fact Book, 2007) 48.8 million; 15.7% are single (IPIR, 2007) ZZS Market - single 20-30 year olds


Market Size: Market Size South Korean’s Top Seven Cities Seoul (10.3 million), Busan (3.7 million) Daegu (2.5 million), Inchon (2.6 million) Gwangju (1.4 million), Daejeon (1.5 million), and Ulsan (1.0 million) (CIA’s World Fact Book, 2007)


Market Characteristics: Market Characteristics 20-30 year old South Korean’s are: Internet-savvy Not stingy Buy once desire is created Spend time on leisure activities Perceptions of US products good


Taiwan Situation: Taiwan Situation Motor Scooter Capital of Asia 480,656 motorcycles sold in 2006 11,311 units to South Korea $432.2 million 110% increase over 2005


South Korea Need Potential: South Korea Need Potential Limited space Population density Tropical climate Popularity of Motor Scooters


South Korea Needs to Avoid: South Korea Needs to Avoid The Pollution in Taiwan 330,000 tons of carbon monoxide 90,000 tons of chemical compounds/yr Popularity of Motor Scooters


Exchange Rate Trends: Exchange Rate Trends Figure 1 – Past Trend Present Value & Future Projection Note. From The Financial Forecast Center / http://www.forecasts.org/won.htm. Copyright 2007. Reprinted with permission for educational use.


Exchange Rate Trends: Exchange Rate Trends Figure 2 – Current Exchange Rates Note. From The Financial Forecast Center / http://www.forecasts.org/won.htm. Copyright 2007. Reprinted with permission for educational use.


Import Restrictions: Import Restrictions Trade Agreement 95% will be duty free (AEA, 2007) Economic relationship with US strong American investments close to $30 billion (AEA, 2007) US FDI $4.7 billion in 2004 (AEA, 2007)


Government | Attitudes : Government | Attitudes Trade Agreement Interested in building relationship 2006 Corruption Perceptions Index South Korea ranks 40th South Korea rated a 5.0


Competition: Competition Major Competitors - Taiwan 480,656 motorcycles exported in 2006 11,311 units to South Korea $432.2 million 110% increase over 2005


Major Competitors - Taiwan: Major Competitors - Taiwan SanYang Industry Co., Ltd. Her Chee industrial Co., Ltd. Kwang Yang Motor Co., Ltd.


Sociocultural Forces: Sociocultural Forces Languages Education Attitudes and beliefs


Marketing Strategies: Marketing Strategies Collateral Material Traditional Advertising Television, radio, print, & outdoor Website Major Promotional Event


Conclusion: Conclusion Basic need potential established Trade agreement demonstrates government attitude Tariffs to be removed No price controls Favorable opinion of US brands New technology to revolutionize industry


Slide18: References American Electronics Association (AEA). (2007). The U.S.-South Korea free trade agreement. Retrieved August 1, 2007 from http://www.aeanet.org/aboutaea/aboutstart.asp Business Monitor International (2007), The South Korea Business Forecast Report. [Electronic version.] Retrieved August 22, 2007 from Website: http://www.businessmonitor.com/businessforecasts/southkorea.html Central Intelligence Agency. (2007). CIA World Fact Book. Retrieved July 30, 2007 from https://www.cia.gov/library/publications/the-world-factbook/geos/ks.html Guido, E. (2006). KYMCO grows global presence. Powerports Business, February 2006. [Electronic version]. Retrieved on August 25, 2007 from Website: http://findarticles.com/p/articles/mi_hb4385/is_200602/ai_n18894462 International Partnerships and Industry Relations (IPIR). (2007) South Korea: Market and trade profile. Retrieved August 1, 2007 from Website: http://www.tourismtrade.org.uk/Images/South_Korea_PDF_17M_tcm12- 32255.pdf  


Slide19: References Kim, A. & Markheim, D. (2006). Time to fast track South Korea free trade agenda. Retrieved August 2, 2007 from Website: http://www.heritage.org/Research/AsiaandthePacific/wm964.cfm Lambsdorff, G. (2005). TI 2005 corruption perception index. Retrieved July 12, 2007 from Website: http://www.transparency.org/policy_research/surveys_indices/cpi/2005 Lane,T. (2007). TIA Report explains South Korea business market, trends. Retrieved August 2, 2007 Motorcycle Business to Business. (2006). Motor export down slightly. Retrieved from http://www.motorcyclesb2b.com/news/Motorcycle%20Export.htm Tso, C. and Chang, S. (2002). A viable niche market--fuel cell scooters in Taiwan. Retrieved August 22, 2007 from Website: http://www.tfci.org.tw/Uploadfile/DownFile/8/1023155544541.pdf Sanyang Industry. (2007). Retrieved August 25, 2007 from Website http://www.sy-egd.com.tw/ea-1.htm U.S. Department of State, Bureau of East Asian and Pacific Affairs (2007) Background notes: South Korea. Retrieved on July 30, 2007 from http://www.state.gov/r/pa/ei/bgn/2800.htm