HL Holdings wins exclusive AS parts deal from Stellantis
HL Holdings Corp., the holding company of South Korea’s construction-to-auto parts conglomerate HL Group, will exclusively supply aftermarket parts for Jeep, Peugeot and Fiat vehicles running on roads in the Asian country.
According to sources in the Korean auto parts and component industry on Tuesday, HL Holdings recently signed an exclusive deal with Eurorepar Car Service, a multi-brand maintenance and repair unit under 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 in 2027.
SK Networks Co. is the current market leader in Korea with 110 billion won ($80.8 million) in aftermarket imported car parts sales in 2023.
HL Holdings raked in 73.8 billion won in aftermarket imported mobility parts sales last year, more than tripling from 2019.
“If HL Holdings meets its goal as planned, it will vie for the top spot against SK Networks, which operates Speedmate,” said an official from the auto parts industry. 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 are about 30% cheaper than OEM parts in general, but that doesn’t mean their quality is worse than the factory-origin parts. 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, the total numbers of registered imported vehicles are 3,385,101 units as of 2023. Of them, over 2 million units are expected to use aftermarket replacement parts.
To shore up its position in the Korean aftermarket imported car parts market, HL Holdings is also seeking to partner with the world’s major 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 inspection and maintenance services for used imported cars to their delivery.
It opened a Fleet-ON center with a floor area of 30,000 square meters in Hwaseong, Gyeonggi Province late last year. It can house 1,500 cars.
Its aftermarket parts business is expected to create great synergy with its fleet car services, said industry observers.
HL Holdings was renamed into the current name from Halla Holdings in late 2022 when HL Group changed the names of all group companies in commemoration of the group’s 60th anniversary.
The holding entity runs various businesses, ranging from mobility and logistics services to cold chain business.
Its affiliates include HL Mando Corp., an electric vehicle and self-driving system developing unit; construction firm HL D&I Halla Corp.; and self-driving technology developer HL Klemove.
Write to Jin-Won Kim at jin1@hankyung.com
Sookyung Seo edited this article.
