] Hyundai Motor Group’s automobile sales appears likely to record the first on-year drop since 1998.
During the first three quarters, Hyundai Motor
and Kia Motors
sold slightly over 5.62 million units, down 1.8 percent compared to the same period last year.
At the rate seen so far this year, not only is the group unlikely to meet the 8.13 million unit target, but will also see its annual sales fall below that of last year. In 2016, the auto giant sold over 8.01 million units around the globe.
Hyundai Motor facebook
Although the figure was far short of the 8.2 million unit target, the conglomerate had managed to surpass the previous year’s record by about 10,000 units.
With the drop in sales, industry watchers are projecting the carmaker’s operating profit will suffer.
Industry watchers have projected that Hyundai Motor’s operating profit for the third quarter could be cut by as much as 25.3 percent compared to the same period last year.
Hyundai Motor’s operating profit has been sliding since the second quarter of 2012 when it came to over 2.53 trillion won (US$2.23 billion). For the third quarter of 2016, projections as low as 1.12 trillion won have been put forward.
The group has been hammered by a series of obstacles since 2014, when its global sales reached a record high.
Demand from emerging markets such as Brazil and Russia have been dwindling, while Japanese rivals’ drive has been aided by the weak yen in developed markets. In addition, Chinese carmakers have been closing in on the South Korean carmakers with Hyundai and Kia’s combined share of the Chinese market dropping to 8.1 percent this year.
The situation in the domestic market has been no less difficult. In addition to the sluggish economy, the ending of the tax cuts and labor dispute have cut output and sales.
By Choi He-suk (email@example.com