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Hyundai starts to sweat from pandemic woes

(Hyundai Motor Group)
(Hyundai Motor Group)

Hyundai Motor Group posted a mixed earnings report Thursday, with a rise in operating profit overshadowed by the effects of the novel coronavirus. 

The carmaker said its first-quarter sales amounted to 25.3 trillion won ($20.5 billion) and operating profit 863.8 billion won, having respectively risen by 5.6 percent and 4.7 percent on-year amid product improvement and the weak Korean won. 

But currency factors also weighed on the auto giant’s net profit, which plunged 42.1 percent on-year to 552.7 billion won, due mainly to poor performance in China amid the coronavirus pandemic.

The company said the second-quarter figures would become more visibly negative due to the economic impact of the COVID-19 pandemic, which is affecting profitability amid growing uncertainty in the automotive industry and reduced consumer demand.

According to Hyundai Motor Group, the company sold 903,371 vehicles globally from January to March. The figure has dropped by 11.6 percent on-year. 

In the domestic market, despite the launches of new models including the GV80 and the new Grandeur, total sales amounted to just 159,061 vehicles due to factory shutdowns over COVID-19. Overseas sales fell by 11.1 percent on-year to 744,310 vehicles. 

A Hyundai Motor Group official said the Q1 operating profit had in fact decreased, considering the company spent some 100 billion won to set up a 50-50 joint venture with Aptiv, a US software developer that focuses on autonomous vehicles.

By Kim Da-sol (ddd@heraldcorp.com)
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