TOKYO - In years past, the Koreans came to the Tokyo Motor Show to test the waters, but without firm plans to sell in Japan.
This year, they came with a purpose.
Both Hyundai Motor Co. and Daewoo Motor Corp. this year announced plans to enter the Japanese market. Daewoo jumps in this month with the Matiz minicar but will limit itself for now to Internet-based sales.
Daewoo is setting up Matiz Corp., a fully owned subsidiary, to market the car in the Kyushu and Kanto areas. Volume expectations are modest: 4,000 units in the first year.
'We're thinking about adding dealers in the future, but there are no immediate plans,' explained Daewoo Motor President Kim Tae-Gou.
Matiz prices will range from 700,000 for the base model up to 1.1 million for a fully loaded edition, or about $6,700 to $10,500.
Not a mini
With its 800cc engine, the Matiz does not qualify as a minicar under Japanese regulations, which stipulate 660cc as the maximum engine displacement to benefit from tax breaks and other government incentives.
There are no plans to spice up the Matiz with turbocharging, variable valve timing, continuously variable transmissions and other technical enhancements that characterize Japan's intensely competitive and sophisticated small-car market.
'Styling is the main merit of the Matiz. We believe Japanese consumers will appreciate that fact, just as Europeans have,' said Shim Bong-Sup, vice president of research and development for Daewoo.
Daewoo has sold more than 250,000 Matizes in Europe since its launch there in September 1998.
Hyundai's different tack
Hyundai is taking a slightly different tack. It wants to start in Japan with its Trajet compact minivan and Santa Fe sport-utility but isn't quite ready to discuss distribution specifics or projected volumes.
'We don't think we can be competitive in Japan with minicars,' said Hank Lee, director for export planning.
Hyundai will not start before the final quarter of 2000. The company has ruled out any piggyback arrangement in Japan with Mitsubishi Motor, its long-standing technical and equity partner.
'We're still studying our options,' said Lee.
Although the Koreans are prolific exporters of cars, they have steered clear of the Japanese market until now. Under a long-standing agreement between Tokyo and Seoul, Japan desisted from exporting a wide range of consumer goods, including cars, to Korea in deference to the multi-billion-dollar trade surplus it runs with Korea.
However, under new international trade rules, Korea is dismantling remaining trade barriers and opening its markets to the full range of Japanese consumer goods, including cars, effective this year.