The aggressive advance of Asian car makers has become one of the overriding concerns of domestic automotive groups, not only in the United States, but also in Europe. In the US, Toyota's recent rise to the number three spot and Chrysler's fall to number four clearly shook many in the business.
While in Europe, Asian manufacturers currently have around 17% of the market.
Hyundai's success in Europe has been particularly pronounced. The South Korean car maker experienced 11% growth in 2002 while the overall market shrank by about 3%.
Toyota, meanwhile, hopes to lift sales in Europe by 50% by 2010.
"This is an aspirational figure. We do not know exactly how we want to get there yet, but we're aiming for around 1.2 million from around 800,000 this year," said Tadashi Arashima, chief executive of Toyota Motor Marketing Europe.
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It seems it is what the Asian car makers are putting inside their vehicles that are making them so popular.
A good example is the Kia Sorrento. It has been voted Europe's best 4x4 by journalists, and is the best-selling sports utility vehicle (SUV) in Europe. The standard interior specification is helping it to beat rivals hands down. The spec includes cruise control, leather upholstery, air-con, a sun roof and a CD-player - all for 30,000 euros. It is no wonder that Western manufacturers are feeling nervous.
Take the BMW X3, the new SUV from the Bavarians. It is 33% more expensive than its Korean competitor, and although the engine is a bit bigger at three litres, it shares pretty much the same interior spec as the Sorrento.
Kia says it is simple economics how they manage to affordably fit it all in.
Value for money?
Kia's Getz is another case in point.
Volkswagen's new Golf European car makers are surrounded by competitors. This car is at the smaller end of the scale and certainly at a small price. For 8,500 euros you get a 1.6-litre engine, electric front windows, power steering, anti-locking brakes, twin side airbags and a CD-player as well.
Its nearest rival, Volkswagen's Polo, will set you back around 15,000 euros, with nowhere near as many features. And unlike the Getz, a CD-player is only available in an extras package costing an additional 2,500 euros.
Such shortcomings among the incumbent car makers explain why the Asians believe they will win an increasingly larger share of western car markets.
That is about 15% of the projected market for Europe in the middle of this decade.
Luxury
The Koreans also want to tackle the top end of the market. At 36,000 euros, Kia's Oprius executive model does not exactly have a pocket-money price tag. But in Kia's eyes it is a head-on collision with Mercedes' E-class.
Take a quick look at the German car's 57,000 euros starting price and you can see why cost-conscious companies might want to take a test drive with the Koreans. To be fair, the Asians can hardly be described as conquering Western markets.
In fact, some analysts suspect it could take 25 years before they dominate as much as 30% of the European market.
There is also the additional issue of quality.
The interiors of European models like the BMW X5 and X3 are significantly superior to anything the Asians produce. Besides, while the Asians are targeting the US and Europe, they are also facing an attack at home. Big Western manufacturers like General Motors and Ford are setting up shop in countries from China to India.
