Kim Hyun-bin began his journalism career at Arirang TV from 2012 to 2017, specializing in defense, foreign affairs and the economy. In 2018, he joined The Korea Times, covering society and business, and is currently responsible for embassy affairs.
Hyundai Motor faces more challenges in 2nd half
Hyundai Motor and Kia Corp. headquarters in Seoul / Courtesy of Hyundai Motor Group
By Kim Hyun-bin
Carmaker's Q2 operating profit reaches 2.97 trillion won
By Kim Hyun-bin
Hyundai Motor will face more difficulties in the second half of the year due to ongoing global economic uncertainties, despite achieving record-breaking profits for the second quarter, Korea's largest carmaker said Thursday.
“Global vehicle sales remain low due to disruptions in the supply of automotive parts and raw materials, including semiconductors, amid the Russia-Ukraine war and the COVID-19 pandemic. The recovery is progressing more slowly than expected,” a Hyundai Motor official said during a conference call held online.
“At the same time, there are worsening external uncertainties, such as the recent increase in inflation, interest rate hikes and the resurgence of COVID-19. Global industrial demand this year was expected to recover to over 80 million vehicles at the beginning of the year, but these figures have been inevitably adjusted to mid to upper 70 million vehicles.”
However, the demand for global electric vehicles (EV) is expected to show continuous growth this year, especially in the U.S., Europe and the domestic market.
“We have about 640,000 standby vehicles in Korea as of the end of June, and in Europe and the U.S., customers who want to wait to purchase a vehicle are also increasing. In particular, in the case of Europe, the number of standby shipments as of the end of June is estimated to be about 140,000 vehicles,” the Hyundai Motor official said.
Hyundai Motor's net profit rose to 3.08 trillion won ($2.34 billion) from 1.98 trillion won during the same period last year. The second-quarter bottom line was buoyed by increased sales of Hyundai's independent brand Genesis models, as well as decreased incentives and the weakened won against the dollar.
Such factors helped offset the carmaker's production losses resulting from the ongoing chip shortage and supply disruptions, the company said.
Hyundai Motor recorded its largest operating profit for the second quarter, with its net profit jumping 56 percent from a year earlier, according to company filings, Thursday. Operating profit soared to 2.97 trillion won in the second quarter from 1.88 trillion won for the same period the year before. Sales in the cited period rose to 35.99 trillion won, up 18.9 percent from 30.33 trillion won.
In the first half of the year, Hyundai Motor sold a total of 1.88 million vehicles, reaching 43 percent of its sales target of 4.34 million vehicles for the year.