HL Holdings Corp., the holding company of South Korea’s construction-to-auto parts conglomerate HL Group, will be the exclusive supplier of aftermarket parts for Jeep, Peugeot and Fiat vehicles running on the country's roads.
According to sources in the Korean auto parts industry on Tuesday, HL Holdings recently signed an exclusive deal with Eurorepar Car Service, a multi-brand maintenance and repair unit of the world’s No. 6 auto group Stellantis NV, to supply its aftermarket auto parts in Korea.
Following the deal, the Korean auto parts supplier hopes to control the largest share of the country’s aftermarket imported car parts market by 2027.
SK Networks Co. is currently the market leader in Korea with 110 billion won ($80.8 million) in aftermarket imported auto parts sales in 2023.
Last year, HL Holdings raked in 73.8 billion won in aftermarket imported mobility parts sales, more than triple its 2019 amount.
(Graphics by Sunny Park) “If HL Holdings meets its goal as planned, it will vie for the top spot against SK Networks, which operates Speedmate,” said an auto parts industry official. Speedmate is SK Networks’ car maintenance and repair service unit.
GROWTH POTENTIAL
Aftermarket parts are components made by manufacturers other than the original manufacturer. They are often used instead of original equipment manufacturer (OEM) replacement parts.
Aftermarket parts cost about 30% less than OEM parts, but that doesn’t mean their quality is worse. They are widely used in cars with an expired warranty.
HL Holdings currently supplies about 60,000 parts and components for 22 imported car brands, including Mercedes-Benz and BMW, in Korea.
According to data from Korea’s Ministry of Land, Infrastructure and Transport, 3,385,101 imported vehicles were registered in the country as of 2023. Of them, more than 2 million units are expected to use aftermarket replacement parts.
Imported car auto parts supplied by Hl Holginds (Screenshot captured from HL Holdings website) To shore up its position in the Korean aftermarket imported car parts market, HL Holdings is also seeking to partner with world-leading parts makers such as Bosch and ZF Friedrichshafen, according to sources.
It has recently enhanced its fleet management business, which offers all-in-one fleet car services ranging from the inspection and maintenance of used imported cars up to their delivery.
Late last year, it opened a Fleet-ON center in Hwaseong, Gyeonggi Province, that can house 1,500 cars.
Its aftermarket parts business is expected to create significant synergy with its fleet car services, said industry observers.
