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Current states of industrial competitiveness of connected cars based on Korea-China cooperation and its implications

Author Seungmin Kim Date 2017.05.17 Issue No
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Recently, connected cars, which are vehicles that IT and network technologies are applied to, have emerged as new items in the market. Although relevant markets are yet in their initial stages, competition has been intensified as IT and automobile companies are expanding investments to capture new markets. In Korea, mostly large companies in the automobile and IT industry expand investments, with the rising number of cases of cooperation and M&A among industries. In the world largest automobile market, China, interests of consumers have been heightened as well. Focused on IT companies, cooperation with automobile companies and investments in R&D are being proceeded. China is behind Korea in terms of the competitiveness of major technologies. However, it is analyzed that China has a competitive edge over Korea in terms of connected cars service and contents thanks to large-scaled investments in large companies in the IT service industry.

In order for Korea to enhance its industrial competitiveness in connected cars, above all, it is necessary to understand how competitive connected cars are in China and actively push for advancing in Chinese market. For this, it is necessary to secure a market share of connected cars in China by actively supporting policies of entering Chinese market, developing technologies concerning connected cars in the field of automotive application components, and manufacturing complete vehicles with competitiveness. Second, it is necessary to expand cooperation between Korea and China in technology standard certification field to establish international standard of technology of connected cars. Above all, the international cooperation among core technologies and component parts is necessary, for example electronic devices, semiconductor chips of automobiles, internet technologies, etc. Therefore, Korea, which has a competitive edge in the field mentioned above, has a high possibility to cooperate with China, staying in a win-win relationship. Third, it is necessary to foster service fields of connected cars via cooperation between automobile and IT companies. China has been diversifying its investment in service fields of connected cars, mainly focusing on large IT service companies, while Korea is lack of investments in service. Therefore, we cannot neglect the possibility that Korea’s service markets could be eaten into by China if Chinese companies increasingly enter into Korean markets. Besides, we should not neglect the importance of cooperation between Korea and China, for example, joint development of service platforms of connected cars, etc.