K Car formally joins group after acquisition closes

Connects vehicle purchase, use, management and resale

Expanded cooperation with KGM on used cars and rentals

Overseas direct-purchase platform also in the works

KG Group Chairman Kwak Jae-sun (center), KG Mobility Platform CEO Jung In-kook (right), branch chief Kim Ju-hwan, President Kwak Jeong-hyun (third from left) and Edaily M CEO Kwak Hye-eun pose for a photo at the KG Mobility Platform chairmanship inauguration ceremony on Tuesday. [KG Group]
KG Group Chairman Kwak Jae-sun (center), KG Mobility Platform CEO Jung In-kook (right), branch chief Kim Ju-hwan, President Kwak Jeong-hyun (third from left) and Edaily M CEO Kwak Hye-eun pose for a photo at the KG Mobility Platform chairmanship inauguration ceremony on Tuesday. [KG Group]

KG Group Chairman Kwak Jae-sun has personally taken the chairmanship of KG Mobility Platform, the company that operates the used-car platform K Car. The move is aimed at building an integrated mobility business structure — spanning vehicle purchase through resale — by linking the group's scattered automotive operations, from finished-vehicle manufacturing to financial services, car rentals and used-car retail.

KG Group said Tuesday it held Kwak's inauguration ceremony as KG Mobility Platform chairman at Harmony Hall in KG Tower in Jung-gu, Seoul. KG Mobility Platform is the renamed corporate entity of the former K Car, though the K Car brand will remain in use.

The inauguration came immediately after KG Group completed its acquisition of K Car. KG Steel finalized the purchase of a 52.5 percent stake in K Car from Han & Company Auto Service Holdings on Monday for about 394.6 billion won ($287 million), roughly five months after the share purchase agreement was signed in late March.

KG Group had already signaled the formal addition of the new affiliate at its 41st anniversary event on Saturday, where it presented KG Mobility Platform with a nameplate and company flag.

In his inaugural address, Kwak said the company must pursue sustainable growth and create social value through its business.

"We must make KG Mobility Platform a sustainable company that can survive and grow on its own," Kwak said. "Beyond that, we must become a company that enriches the world through the services and value we provide."

He also called on all employees to "join as one in the journey of building a healthy and strong company."

The core of KG Group's vision is to connect the entire vehicle lifecycle within the group. The plan is to combine KGM's new-car manufacturing with the group's financial and rental-car operations and K Car's used-car retail platform, creating a business structure that runs from vehicle purchase and use through maintenance and eventual resale.

KG Group had already laid out this integrated mobility framework — linking manufacturing, retail and financial services around the K Car acquisition — as its medium- to long-term growth strategy at a presentation in June.

The group plans to leverage KG Mobility Platform's used-car distribution network and online sales capabilities in particular. K Car operates on a direct-sales model, buying vehicles directly from consumers, inspecting and servicing them, and reselling them. It currently runs 48 company-owned outlets nationwide.

Its service lineup includes a home-delivery car-buying service for online purchases, a used-car quality warranty program called K Car Warranty, and a peer-to-peer used-car transaction support service. The company also operates a long-term car rental business covering both new and used vehicles.

KG Group intends to graft KGM's vehicle technology and customer base onto this platform. The two companies plan to maintain their respective operations while gradually developing collaboration models in areas such as used-car trade-ins for new-car buyers, certified pre-owned vehicles and car rentals.

The group is also targeting overseas markets. Beyond its existing business of exporting used cars abroad, it is pursuing a plan to build a local used-car platform that directly buys and resells vehicles in foreign markets — effectively transplanting its domestic direct-sales model overseas.

KGM has also been expanding external partnerships. Last month it agreed to issue $75 million in convertible bonds to China's Chery Automobile, and the two companies are pursuing strategic cooperation on new vehicle development and electrification. If all the bonds are converted to shares, Chery would become KGM's second-largest shareholder after KG Eco Solution.

KG Mobility Platform is a direct used-car platform company listed on the Kospi in 2021. It has been in the used-car business since 2000, building 26 years of experience in the sector. Last year it launched a vehicle management service called MyCar, which provides maintenance and usage information beyond just buying and selling cars.


kwater@heraldcorp.com