'Plan discount' with 40-month commitment offers up to 1 million won in benefits

Temporary price freeze eases burden on dealers

Kumho Tire and Lotte Card signed an MOU on their co-branded credit card at Lotte Card's headquarters in Jongno-gu, Seoul, on Oct. 26. Kim Sung (left), executive director of Kumho Tire's Korea sales division, and Choi Moon-seok, head of a Lotte Card division, pose for a photo at the signing ceremony. [Kumho Tire]
Kumho Tire and Lotte Card signed an MOU on their co-branded credit card at Lotte Card's headquarters in Jongno-gu, Seoul, on Oct. 26. Kim Sung (left), executive director of Kumho Tire's Korea sales division, and Choi Moon-seok, head of a Lotte Card division, pose for a photo at the signing ceremony. [Kumho Tire]

Kumho Tire announced Tuesday it is teaming up with Lotte Card to launch a co-branded credit card called "Kumho Tire × LOCA" for tire buyers. Customer services under the card will officially begin Friday.

The two companies signed an MOU at Lotte Card's headquarters in Jongno-gu, Seoul, on Oct. 26. The signing ceremony was attended by Kim Sung, executive director of Kumho Tire's Korea sales division, Choi Moon-seok, head of a Lotte Card division, and working-level staff from both sides. Kumho Tire said the card was designed to lower customers' upfront costs when replacing tires and expand purchase benefits.

The centerpiece of the card is a "plan discount" service. Customers who buy tires at participating offline dealerships or through the online store Tire Pro receive an upfront discount of 400,000 won ($299) or 800,000 won, tied to a 40-month commitment. Each month, if the cardholder meets the required spending threshold from the previous month, that month's plan discount installment is waived. Under the 400,000-won plan, a monthly charge of 10,000 won is waived when the previous month's card spending reaches 400,000 won or more; under the 800,000-won plan, a monthly charge of 20,000 won is waived when spending reaches 800,000 won or more.

An additional cashback promotion will run alongside the card launch, targeting customers who have had no Lotte personal credit card activity in the past six months. Those who meet the qualifying conditions will receive 10,000 won per month under the 400,000-won plan, or 5,000 won per month under the 800,000-won plan, for 40 months. Customers who fulfill all conditions every month over the full 40-month period can receive up to 800,000 won under the 400,000-won plan — combining the 400,000-won plan discount with 400,000 won in accumulated cashback — or up to 1 million won under the 800,000-won plan, combining the 800,000-won plan discount with 200,000 won in cashback.

If a cardholder falls short of the previous month's spending requirement, the plan discount charge for that month will be billed and no cashback will be paid. Canceling the card mid-term requires immediate repayment of the remaining plan discount balance. Annual fees and card payment charges are separate, and the eligibility criteria, payment conditions, spending calculations and exclusions for each benefit are governed by Lotte Card's product terms and promotional notices.

Customers who do not use the plan discount will receive 1 percent cashback at domestic merchants and 2 percent at overseas merchants, subject to the card's spending conditions. Interest-free installment plans of two to three months are also available; details on eligibility and limits can be found in Lotte Card's product guide.

Kumho Tire said it has temporarily held off on raising prices despite higher raw materials costs, increased logistics expenses and price hikes by competitors in the domestic replacement tire market, in order to ease the sales burden on its dealerships. The company said it plans to use the co-branded card launch to lower the cost barrier for customers, strengthen ties with its retail network and drive sales growth and market share recovery.


eyre@heraldcorp.com