'Automobiles and Semiconductors' Lead Triple Rise in Production, Consumption, and Investment in Three Months

Domestic production, consumption, and investment all increased in June.

This triple increase marks the first time in three months since March.

Production surged significantly as the supply and demand of automobile parts normalized, and increased consumption of passenger cars also impacted retail sales.

Semiconductor production also turned to an upward trend, leading to the largest increase in all-industry production in six years.

According to the June Industrial Activity Trends released by Statistics Korea today, the total industry production index (seasonally adjusted, excluding agriculture, forestry, and fishing) stood at 120.1 (2020=100) last month, up 2.3% from the previous month.

All-industry production increased by 2.1% in February and 0.4% in March.

After declining for two consecutive months in April (-0.5%) and May (-0.4%), it shifted to an increase last month.

The growth rate in June was the largest since June 2020 (2.9%).

Mining and manufacturing production rose 6.4% from the previous month.

Likewise, this is the largest increase in six years.

By industry, automobile production increased by 15.4%.

Lee Doo-won, Director General for Economic Trend Statistics at Statistics Korea, explained, "Automobile production surged significantly as the supply and demand of parts, which had been unstable due to a fire at an automobile engine component company in March, normalized and domestic and overseas demand increased."

Semiconductor production also rose 4.5%, rebounding from a sharp drop in May (-10.0%).

Statistics Korea explained that semiconductor production fluctuates according to monthly production plans and increased last month due to a rise in overall demand for memory and non-memory semiconductors.

Electronic components (-10.4%), communications and broadcasting equipment (-1.5%), and computers (-4.9%) decreased.

The retail sales index, which signifies goods consumption, increased by 2.7% from the previous month.

Sales surged in durable goods (12.6%), such as passenger cars, communication devices, and computers.

The growth rate of durable goods sales was the highest in 16 years and 9 months since September 2009 (14.0%).

Passenger car sales jumped 21.8%, recording the largest increase in 6 years and 3 months.

In addition to the normalization of supply and demand, a surge in demand ahead of the expiration of the individual consumption tax cut at the end of June played a role.

Discount events on home appliances and communication devices by Samsung Electronics and LG Electronics also influenced the increase in retail sales.

Service industry production, which indicates service consumption, increased by 0.7%.

Facility investment rose 5.8% from the previous month.

Investment increased across both machinery (6.9%), such as precision equipment, and transportation equipment (3.4%), centered on automobiles.

Construction output (constant), which represents the domestic construction performance of builders, increased by 4.1% from the previous month as an increase in building construction (5.9%) offset a decline in civil engineering (-1.3%).

The cyclical component of the coincident index, which indicates the current economic situation, rose 0.5 points (p) from the previous month.

The cyclical component of the leading index, which forecasts future economic phases, went up 0.9p.

In the second quarter, all-industry production increased by 0.9% from the previous quarter.

Retail sales decreased by 1.7%, and facility investment increased by 3.6%.

In the first half of the year, all-industry production grew by 2.8%.

Retail sales increased by 2.8%, and facility investment jumped 11.4%.

However, construction investment declined by 5.3%.

(Photo: Yonhap News)
※ Please note: This article was translated by AI and may contain errors.