Millennium Post

South Korean Hyundai’s income stutters 22% in Oct-Dec quarter

South Korean Hyundai’s income stutters 22% in Oct-Dec quarter
South Korea’s largest automaker said on Thursday its October-December net income dropped 22 per cent from a year earlier to 1.66 trillion won ($1.53 billion). The median expectation of analysts surveyed by financial data provider FactSet was a 2 trillion won profit. Sales rose 8 percent to 23.6 trillion won.

Hyundai blamed unfavorable foreign exchange rates for the lower earnings. Even though the South Korean won fell against the US dollar in favour of Hyundai, it rose against the Russian ruble and the currencies of other emerging market nations. The automaker also had to give more incentives to consumers in the US to weather competition and to boost sales of older models, such as the Elantra.

For this year, Hyundai forecast sales will grow just 1.8 percent to 5.05 million vehicles, the weakest growth in recent years. The company expects to begin production at a new factory in China next year, but until then its existing factories are operating at full capacity, leaving no room to boost sales significantly.

“It is true that there are concerns about losing market share as the overall industry is expected to grow 3.9 percent,” Lee Won Hee, chief financial officer at Hyundai Motor, said at an earnings conference call. “We will try to surpass our 5.05 million goals.”

Hyundai will try to improve productivity at existing facilities, which helped the company to exceed its sales target in 2014. Hyundai Motor Group, the world’s fifth-largest automaker that comprises Hyundai and Kia Motors Corp., earlier this month forecast the weakest sales growth in more than
a decade.
AP

AP

Our contributor helps bringing the latest updates to you


Share it
Top