Hyundai Motor Company surpasses 30 trillion won in sales for the first time in its history… Highest operating profit in 7 years
Kia’s sales and operating profit are all-time high… Operating profit grew 924%
Hyundai Motor Company and Kia Motors achieved ‘surprising results (earnings surprise)’ in the second quarter of this year despite the ‘semiconductor supply and demand shortage’. This is thanks to the strong performance in overseas markets such as the United States and Europe, which were sluggish due to the global pandemic (pandemic) of the novel coronavirus infection (COVID-19) in the second quarter of last year.
According to Hyundai Motor Company and Kia Motors on the 22nd, the combined sales of the two companies in the second quarter were 48.66 trillion won and operating profit was 3.373.2 trillion won, respectively. This is an increase of 46.5% and 358.6% compared to the same period last year. The global sales volume of both companies was 1,785,466 units, up 46.3% compared to the same period last year.
Looking at the performance by company, Hyundai Motor’s operating profit in the second quarter increased by 219.5% compared to the same period of the previous year, bringing it to KRW 1.88 trillion. This is the highest in seven years since the second quarter of 2014 (2.872 trillion won). Sales were also counted at 30.32 trillion won, surpassing 30 trillion won in sales for the first time in history. The operating profit margin for the second quarter was 6.2%, an increase of 3.5 percentage points compared to the same period last year. Global sales were 1,031,349 units (206,682 domestic and 836,667 overseas), up 46.5% from the same period last year.
Kia’s growth was also terrifying. In the second quarter, sales reached 18.33 trillion won and operating profit was 1.48 trillion won, respectively. This is an increase of 61.3% and 924.5% from the same period of the previous year, which is Kia’s record high 2Q performance. The operating profit margin was 8.1%, an increase of 6.8 percentage points from the same period last year, again the highest level ever recorded. In the second quarter, Kia sold 74,117 units (148,309 domestic and 605,808 overseas) in the global market, up 46.1% from the same period last year.
Hyundai Motor and Kia’s record-high 2Q earnings were driven by a surge in overseas sales. In the second quarter of last year, overseas sales such as Europe, the United States, and India plunged due to the severe aftermath of COVID-19. However, in the second quarter of this year, the market showed a recovery trend thanks to strong economic stimulus measures by governments and expansion of vaccinations. In such a situation, Hyundai Motor and Kia introduced a large number of new cars such as the GV80, Ioniq 5, Sorento, and Carnival, showing high growth of 73.6% and 70.9%, respectively.
However, both companies expressed concern about the business situation after the third quarter. This is because the shortage of semiconductors for vehicles is longer than expected, and the re-spreading of COVID-19 caused by a mutant virus is not serious. In addition, the sharp rise in raw material prices recently is a burdensome factor. In particular, to improve semiconductor supply and demand, Hyundai Motor Company and Kia are △Promoting additional supply by mobilizing company-wide capabilities △Preemptively securing inventory through annual orders △Promoting partnerships with major semiconductor companies △Continuing discovery of alternative devices △Diversifying suppliers to produce in the second half of the year We plan to pursue an increase.
Seo Kang-hyeon, head of Hyundai Motor’s finance division (Vice President) said, “Semiconductor supply and demand is expected to gradually improve from the third quarter, but we have completed orders until next year to stabilize long-term supply.” We plan to increase the stockpiling rate and establish inventory stockpiling standards that match the characteristics of each region and item to stockpile the largest stock.”
Ryu Jong-eun reporter [email protected]
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