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In Kim's North Korea, Cars Are Scarce Symbols of Power, Wealth

By Bradley K. Martin

Citizens commute to work on bicycles in Pyongyang July 10 (Bloomberg) -- A black Volkswagen Passat with smoked windows glides down a suburban Pyongyang road. Its license plate begins with 216 -- a number signifying Kim Jong Il's Feb. 16 birthday, and a sign the car is a gift from the Dear Leader.

Even without a 216 license plate, a passenger sedan bestows VIP status in a country where traffic is sparse and imports are limited by external sanctions and domestic restrictions alike.

Just across the border, South Korea is the world's fifth- largest automotive manufacturer. To an ordinary North Korean, though, a private car is ``pretty much what a private jet is to the ordinary American,'' says Andrei Lankov, author of a new book ``North of the DMZ: Essays on Daily Life in North Korea.''

He estimates there are only 20,000 to 25,000 passenger cars in the entire country, less than one per thousand people.

Discouraging private car ownership isn't just a matter of ideology in a communist country, Lankov said in a phone interview from Seoul, where he teaches at Kookmin University. The passenger car, usually black and chauffeur-driven, ``is the ultimate symbol of the prosperity of high officials,'' he says. They keep the vehicles scarce ``so everybody knows they are the boss.''

Measuring, Copying

North Korea moved early -- shortly after the Korean War, and ahead of the South -- to mass-produce trucks and 4-wheel- drive Jeep-type military vehicles. Craftsmen took apart imported Soviet tractors, trucks and utility vehicles, measuring the parts to make copies.

The indigenous civilian passenger-car industry, too, mostly made knockoffs of models produced elsewhere. After importing a fleet of Mercedes-Benz 190s, the country produced replicas under local model names into the 1990s. Unfortunately, the domestically made copies were dogged by reports about ``terrible overall quality,'' says Erik van Ingen Schenau, author of a new pictorial book, ``Automobiles Made in North Korea.''

Lee Keum Ryung, a former used-car trader who defected from North to South Korea in 2004, agrees. The knockoffs came with ``no air conditioning, no heater, and they're not tightly built or sealed,'' he says. ``If you drive out of the city and return, your car will be full of dust. It's like an oil-fueled cart.'' Lee, 40, uses a pseudonym because he fears repercussions from North Korea.

Slow Recovery

Material and energy shortages that accompanied a famine in the 1990s brought state-run factories to a halt. Recovery has been slow, and Schenau said he believes even domestic production of Jeep-style vehicles has been replaced by imports from Russia and China.

Imports have similarly come to dominate what passes for the passenger-car market. Used cars -- mostly Japanese-made -- are the mode of transit for many members of the new trading and entrepreneurial class that's emerged in the last couple of decades. Under a loophole in the country's long-standing private-car ban, these vehicles typically enter the country disguised as gifts to North Koreans from their relatives in Japan's Korean community, Lankov says.

Lee says ``a relative abroad'' helped him buy his first car when he was 23. ``But as an ordinary person, I couldn't keep it under my name, and I didn't have a number plate of my own,'' he says. ``A friend was a high police official with many cars under him. I borrowed a plate.''

`A Very Affluent Life'

Lee had ``a very affluent life'' before he defected, importing 10-year-old cars from Japan and selling them both in North Korea and, for a time, across the border in China. ``I had money, status,'' he says. ``I enjoyed everything people my age could have.''

A small passenger vehicle for which his agent paid $1,500 at the docks in Japan would sell for $2,500 to $3,000, Lee says. A bigger car -- say, a Toyota Crown -- might cost him $4,000 to $5,000; he would sell it for $8,000.

While Japanese trade figures show annual exports of some 1,500 passenger cars, mostly used, to North Korea in 2005 and 2006, the total for this year is zero. After Kim's government tested a nuclear device last October, Japan placed passenger cars on a list of banned luxury exports.

Perhaps as a sign of displeasure with Japan's sanctions, Kim ordered most Japanese cars confiscated, according to a February 2007 dispatch by South Korea's Yonhap News Agency. The order, if indeed it was issued, hadn't been carried out by the time of a May visit to Pyongyang, when a number of Japanese cars could be seen.

German Inroads

When a European-made import passes by, it's often owned by the state, used by high officials and foreign dignitaries. Sweden's Volvo had a hefty market share in the 1970s; Germany's Audi and Volkswagen have made inroads lately. Mercedes is particularly well-represented in Kim's personal fleet of hundreds of vehicles, according to Lee Young Kook, a defector who served in Kim's bodyguard force.

In a 2003 Yonhap News story, Lee said the security- conscious leader traveled in motorcades of identical cars to confuse would-be assassins and generally maintained 10 units each of any model so five would always be road-ready.

With the nation's access to imports constricted, a relatively new player in the market, Pyonghwa Auto Works, has attempted to fill the gap. The company was created when Seoul- based Pyonghwa Motors, which began as a car importer affiliated with Rev. Sun Myung Moon's Unification Church, teamed up as majority partner in the 70-30 venture with the North Korean state-owned trading firm Ryonbong Corp.

Kits of Parts

The first assembly line was set up in 2002 at the west coast port city of Nampo to produce, from kits of parts, a version of the small Fiat Siena, called the Hwiparam (Whistle) in Korean.

So far, the factory has built about 2,000 cars and pickup trucks, according to Noh Jae Wan, a spokesman in Seoul for Pyonghwa Motors, who said it is the only manufacturer now turning out passenger cars in North Korea. According to a February announcement by Brilliance China Automotive Holdings, Pyongyhwa has agreed to let Brilliance use part of the Nampo plant to assemble Haise minibuses.

While some news accounts have mentioned the possibility that the North Korean cars may eventually be sold in the South, ``this will take time,'' Noh said in an interview. ``It can only happen when the two Koreas reach some significant agreement on trade or other international circumstances change.''

To contact the reporter on this story: Bradley K. Martin in Pyongyang at [email protected]

you can find my North Korea doucments on:

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Have they started auto assembly in Kaesong? You know, the place that's supposed to transform North Korea into an auto giant?

I heard Hyundai is the primary investor in the region, maybe not necessarily their auto sector.

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IMO, they won't go unless N.K provide something that make companies feel confident to do the business. I mean you know how the condition can be changed over the night... And yes, the primary investor is Hyundai but it's different company with Hyundai motor since it's founder was passed away..

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I looked at that countries' site for tourism- that's one scary place.
You're not allowed to communicate with people unless they're
authorised, or you can go to jail. The communist party officials
live richly while it's people (maybe less for the lucky ones in
Pyeongyang) starve. Very, very sad.

Phaeton, long time no see btw, welcome back.

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Choson Exchange, a Singapore-based NGO that trains North Koreans in business skills, has posted scans of all the current Pyeonghwa Motors brochures from Pyoenghwa's Pyongyang showroom. I think there are a few models not on Erik's list yet. :)

P.S. There's also an account of a visit to the showroom in October, with a photo slideshow including, among other things, a rebadged Maxus van and a poster showing a full range of vehicles, including some typical Chinese trucks and minibuses.

Choson Exchange heard in 2012 that the Unification Church wanted to pull out, and it seems that they did.
The staff in the Pyongyang showroom said that it was a 100% DPRK company now and had been for "some years", but didn't have much time to chat: they were busy working with a group of Koreans looking to buy. Meanwhile, another group were test driving a jeep-like model.

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Discussion Starter · #19 ·
Gag, it is not a Maxus but a Huanghai Ruitu. I integrated most of them already some weeks ago on my website:
It seems that there is now assembly of Chinese trucks inside the Sungri facility in Tokchon. Here is the article:
On Google Earth you can see that some of the halls are re-painted blue, as is quite often the colour of the car factory halls in China.
The Chinese partner seems to be Sinotruk.
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