CNC Machine Tools
Republic of Korea
Overview
2004 2005 2006 (estimated)
Total Market Size 3,600 3,800 3,800
Total Local Production 2,600 2,900 3,300
Total Exports 1,000 1,150 1,350
Total Imports 2,000 2,000 1,800
(Unit: USD million)
(Source: Korea Machine Tools Manufacturers Association)
[USD 1= 950 Won]
Korea’s market for machine tools has shifted from standard, cost-effective or general products to high-precision, high-speed and high-powered machine tools. In 2005, computerized numerically controlled (CNC) cutting machine tools, including lathes, milling machines, and machining centers, represented 78 percent of total domestic machine tools demand while non-CNC and metal forming machines including presses represented the remaining 22%. The biggest demand for machine tools exists in the automotive production, metal processing, electronics and precision machine industries.
The Korean Machine Tools Manufacturers Association estimates that the import market decreased 10% from 2005 - 2006. This is largely due to the decreasing production of semi-conductor parts. According to the Korean Customs Service, the United States is the second largest importer of machine tools to Korea, with 33% market share. Japan has 42% market share and Germany 10%. Trends over the past three years have shown the import market to be very volatile. For example, imports of US machines tools rose from $20 million in September 2004 to $120 million January 2005. Imports then declined to $20 million, and then rose to $80 million in November 2005. Imports of Japanese machine tools were also as volatile, while German imports remained rather steady.
The Korean CNC machine tools industry continues to be led by investment in production facilities by major manufacturing industries such as automobiles, shipbuilding, telecommunications, construction equipment and electronics, including the semiconductor sector. In particular, many companies are investing in factory automation that will account for growing market demand in advanced machine tools. Given the volatility of the market and the ability of Korean competitors to produce quality machine tools, US importers are most successful where they offer a cost or technological edge.
Best Products/Services
· CNC turning centers
· CNC vertical machining centers
· CNC horizontal machining centers
· CNC 4 & 5-axis machining centers
· Machines for the production & processing of semiconductor wafers
· Machines for dry-etching patterns on semiconductor materials
· Laser cutters for the production of semiconductors
Opportunities
For exporters of U.S. products to Korea, establishing strategic alliances, such as joint ventures or licensing agreements, with leading Korean machine tool manufacturers is recommended. Hiring local agents or distributors also is one of the most effective ways to sell U.S. products in the Korean market. Large machine tool manufacturers have expressed interest in partnering with U.S. CNC machine tool manufacturers.
Resources
Trade Shows
Seoul International Tool & Related Equipment Exhibition
Korea Machinery Fair (KOMAF) 2007
Seoul International Machine Tool Show (SIMTOS) 2007
Key Contacts
Industrial Machinery Division of the Ministry of Commerce, Industry & Energy: www.mocie.go.kr
Korea Machine Tool Manufacturers Association:
Korea Tools Industry Cooperative:
Korea Association of Machinery Industry:
Korea Construction Equipment Manufacturers Association:
Korea Automobile Manufacturers Association:
Korea Automotive (Auto Parts) Industries Cooperative Association:
Korea Aerospace Industries Association:
Korea Aerospace Research Institute:
Local Contact
Nathan Huh
Commercial Specialist
Commercial Service Korea
U.S. Embassy
32 Sejong-ro Jongro-gu
Seoul 110-710 Korea
Tel: 82-2-397-4130
Fax: 82-2-737-5357
E-mail: nathan.huh@mail.doc.gov
Website: www.buyusa.gov/korea