Hyundai Motor Group is expected to see its dominance slip further in the domestic car market this year as the combined market share of its two automakers, Hyundai Motor and Kia Motors, dipped to around 60 percent in January, the lowest monthly record ever.

According to the Korea Automobile Manufacturers Association, the market share of the two automakers here fell 5 percent to 60.7 percent last month from the same period a year ago.

“Behind the sharp fall in domestic sales last month was a steep rise in demand for imported cars, coupled with a seasonal factor,” a market analyst said.

Imported car sales hit an all-time monthly high last month on growing demand for European and Japanese vehicles here, the Korea Automobile Importers and Distributors Association said.

The number of foreign-brand vehicles jumped 16.4 percent to 19,930 units in January from the previous month.

The market share of imported cars, which reached 13.9 percent last year, will exceed 20 percent this year, the association forecast.

The explosive demand for foreign cars directly affects the market dominance of Hyundai and Kia by segment.

KAIDA found sales of Volkswagen’s flagship Golf outpaced Hyundai Motor’s i30 in the Korean midsize hatchback market last year. It is the first time for a foreign car brand to beat a Hyundai or Kia brand outside of the luxury segment.

“Hyundai and Kia could see a similar trend in other segments unless they catch up fast with consumer trends preferring efficient diesel cars over gasoline-powered ones,” an industry insider said.

The domestic market share of Hyundai and Kia will stay below 70 percent this year, industry watchers said.

In 2014, their market dominance dropped to 69.3 percent, falling below 70 percent for the first time since 1998 when Kia Motors merged with Hyundai Motor Group.

By Seo Jee-yeon (jyseo@heraldcorp.com)