Cho Jung-hoon, a transitional member of the era, issued a bill prohibiting the entry of the finished car industry into the used car market for 10 years. Reporter Oh Jong-taek
“Don’t overlook other people’s rice bowls at large companies.” vs “The market will become transparent only when large companies enter.”
A bill has been proposed to ban automakers such as Hyundai Motors and Kia Motors from entering the used car market for 10 years, fueling the online community. The purpose of the bill, which was initiated on the 25th by lawmaker Jo Jung-hoon, is to prevent the monopoly of finished car makers in the used car market and to protect small existing used car dealers, but some point out that it is an excessive regulation that delays the transparency of the used car market.
The’Used Vehicles Trading Win-Win Cooperation Act’ (Act on Win-Win Cooperation in Used Vehicles), initiated by Congressman Cho, prohibits automakers from entering the used car market for 10 years, but before the end of the 10-year deadline, win-win cooperation and cooperation with the existing used car industry. The main idea is to come up with a plan to do it.
Rep. Cho said, “Recently, domestic automakers are attempting to enter the used car market, threatening the survival of small used car dealers. In the mid to long term, consumers are bound to suffer damage by using their dominance,” he said.
The problem of automakers entering the used car market is an old conflict. The domestic used car sales business was designated by the Shared Growth Committee as a’suitable business for small and medium-sized businesses’ in 2013, and the entry of large companies was restricted. With the expiration of the designation deadline in February 2019, the used car industry applied again to designate the used car trading business as a’suitable for livelihood’, but the Shared Growth Committee gave an opinion of’inappropriate’.
However, as the SMEs, which are responsible for making the final decision, postpone the conclusion, the conflict between the industries has virtually been neglected. Rep. Cho said, “The government has repeatedly made frustrating actions on the used car situation. With this initiative, the used car situation will be actively resolved in the National Assembly.”
“The Double Arch Dealer Protection Act?”
However, most consumers who expected that the market would become transparent when large corporations such as Hyundai Motors entered the market responded with “legislation to neglect the muddy used car market.” This is because there have been many cases where consumers have suffered damage due to the opaque used car market structure such as false sales and price manipulation. In the article delivering the news of the bill, comments such as “How long will I have to face the bad practices of the used car industry?”, “Is it not the’Boot Dealer Protection Act’?”, and “If you try to do business, you will hit the regulations.”
The entire used car market in Janganpyeong, Yongdap-dong, Seongdong-gu, Seoul. News 1
Rep. Cho, anticipating such concerns, also proposed the’Automotive Management Act Amendment’ on the 25th to strengthen accountability in the used car market. The bill required the Ministry of Land, Infrastructure and Transport to establish a’used car sales information system’ and impose punitive penalties when used car dealers provide false sales. Rep. Cho said, “In order to reconsider the transparency and accountability of the used car market, companies that sell false sales must be removed.”
The automaker industry and experts are struggling with legislation that bans entry into the used car market. An official of the Korea Automobile Industry Association, which has been promoting the entry of finished car makers into the used car market, said, “Is it contrary to the principle of equality under the constitution to ban market entry for specific targets and infringe on business freedom?” “Finished car makers enter the market. Even if it does, it can coexist with the existing industry by only in charge of the’certified used car’ part.” The official also added, “When finished car makers participate in the market, not only will the market advance, but it will benefit both consumers and the existing industry as the industry expands through innovation using new technologies such as big data.”
Lee Ho-geun, a professor at Daedeok University, said, “After the used car sales business was designated as a suitable business for small and medium-sized businesses in 2013, the market’s efforts to clean up the market were ineffective.”
Reporter Nam Soo-hyun [email protected]
