Korea’s largest automaker Hyundai Motor posted half of its operating profit in the second quarter from a year earlier. But the earnings still came above market expectations due to the launch of new models.
Hyundai Motor’s operating profit fell 52 percent to 590 billion won ($493 million) and sales dropped 19 percent to 21.86 trillion won, according to the firm’s regulatory filings Thursday. Net profit fell 62 percent to 377 billion won.
The automaker said, “The global demand for automobiles has decreased significantly due to the measures to restrict movement in major markets and the suspension of plant operations due to the spread of coronavirus.
“Still, the decline in profits was slightly reduced due to factors including weak Korean won, special consumption tax cuts and strong sales of new cars such as GV80 and G80,” it added.
Hyundai Motor sold 703,976 cars in the global market in the second quarter of this year. The figure is down 36.3 percent from the same period a year earlier.
In Korea, the automaker sold 225,552 units, up 12.7 percent on-year, due to strong sales of new cars such as the GV80, G80 and Avante. In overseas markets, sales fell 47.8 percent on-year to 478,424 units due to decreased demand in all regions except China amid the pandemic.
Regarding the outlook for coming quarters, Hyundai Motor said that negative factors stemming from the pandemic are expected to gradually improve but uncertainties still remain due to concerns over reproliferation.
Hyundai said, “The company plans to continue to push for investments to build a foundation for growth in future businesses such as electric vehicles, hydrogen vehicles and urban air mobility. ... We will make efforts to gain an upper hand in competition in the field of electrification by releasing next-generation electric vehicles with dedicated platforms next year.”
Hyundai Motor said in a conference call Thursday, “For large hydrogen trucks, we are aiming for a 12-15 percent share in the European market by 2030.”
On the same day, Kia Motors said it recorded sales of 11.36 trillion won and an operating profit of 145 billion won, down 21.6 percent and 72.8 percent, respectively, on-year. Its net profit also shrank 75 percent.
Kia’s earnings deteriorated as overseas car sales declined and factories stopped operating.
Sales in the global market fell 27.8 percent to 516,050 units in the period. But it has fared well here, selling 161,548 cars, up 26.8 percent from a year ago, due to the launch of new cars and special consumption tax cuts.
By Shin Ji-hye (email@example.com)