The average repair cost for imported car brands is about five times higher than that for domestic cars, according to a recent report.
In 15 km/h frontal and rear-end crash tests on imported and domestic cars by the Korea Insurance Development Institute, the average repair cost for imported brands was W14.56 million (US$1=W1,126), 5.3 times as much as the average of W2.75 million for domestic cars.
The average front repair cost for imported cars at W10.21 million was 5.6 times higher than for domestic brands (W1.82 million); and the average cost for rear-end repair for imported cars (W4.35 million) was 4.7 times higher than for domestic cars (W930,000).
The institute conducted the crash tests on three pairs of foreign and domestic cars of similar sizes -- the Ford Taurus, the Toyota Camry, and the BMW320d, the Hyundai Grandeur, the Kia K7, and GM Korea's Alpheon.
The reason is the much higher price of parts and labor for foreign cars. The average parts price for imported cars is W8.67 million, 6.3 times more than the W1.48 million for domestic cars.
The average repair labor cost for imported cars is W3.6 million, 5.3 times as much as the W680,000 for domestic cars. The labor cost for domestic cars is a mere W23,000 per hour, as against W30,000-W55,000 for imported cars.
But another reason is that foreign cars suffered damage to wider areas than domestic cars in a crash, so the percentage of repair cost to car purchase price was much higher.
For a new Taurus, the percentage of the repair cost of W15.99 million to the purchase price of W36 million is a whopping 44 percent. But for a Grandeur HG, the percentage of the repair cost of W2.99 million to the purchase price of W36.7 million stands only at 8.1 percent.
The average repair cost for imported cars is 37.7 percent of the price of a new car, but for domestic brands 4.8 percent.
"We need to minimize losses to drivers by setting auto parts prices, which affect repair costs for imported cars, at appropriate levels and establishing common standards for calculating repair costs," the institute said.