INTERNATIONAL - Hyundai Motor Company, South Korea’s largest auto-maker, reported a 20percent plunge in its net profit yesterday, continuing its losing streak to nearly a fourth year, as its sales remain weak in China owing to anger over a missile-defence system.
Hyundai’s overall vehicle sales, except in China, actually increased during the third quarter about 7percent thanks to the popularity of its new products, Kona and G70. But that was not enough to offset its sales decline in the world’s two largest economies, the US and China. Its July-September net profit was 852 billion South Korean won (R10.8billion), compared with 1.1trillion won a year earlier. The result was in line with expectations. Sales rose 10percent to 24.2trillion won, while operating income rose 13percent to 1.2trillion won.
The maker of Genesis and Sonata has recorded profit loss since late 2013 as its passenger sedans fell out of favour, while its rollout of sports utility vehicles was slow.
Compounding its challenge, diplomatic tensions between Beijing and Seoul took a toll on South Korean businesses in China. During the first half of 2017, Hyundai’s sales in China were slashed to nearly half as China’s anger over South Korea’s deployment of a US missile-defence system hurt its sales. Hyundai’s car sales declined 6percent to 3.3 million units.