'Domestic Demand Accelerator' Hyundai Motor, Bright Sales Outlook Over 100 Trillion Won for 2 Consecutive Years

Hyundai Motor Expected to Join '100 Trillion Club' for 2nd Consecutive Year
Kia Achieves Record Domestic Sales Last Year
Operating Profit Declines Due to Large Provisions
This Year Marks the First Year of EV Transition... Momentum for Performance Improvement Continues

[Asia Economy Reporter Suyeon Woo] A green light has been turned on for Hyundai Motor Company’s record of achieving 100 trillion KRW in sales for two consecutive years. Although overseas sales slightly declined amid the COVID-19 crisis last year, strong domestic sales, including Genesis breaking its all-time sales record, contributed to this positive outcome.

According to FnGuide on the 11th, Hyundai Motor’s sales consensus for last year was 104.1049 trillion KRW, expected to decrease by 1.5% compared to the previous year. Operating profit during the same period was forecasted to drop by 20.5% to 2.8635 trillion KRW, and net profit was predicted to fall by 39.8% to 1.7922 trillion KRW.

The significant decline in operating profit and net profit relative to sales is due to a quality provision of approximately 2.1 trillion KRW reflected in the third quarter of last year. Hyundai Motor’s annual sales first surpassed 100 trillion KRW in 2019, and despite difficulties caused by COVID-19 last year, it is expected to exceed 100 trillion KRW again, raising expectations for joining the ‘100 trillion KRW club’ for two consecutive years.

Although the global automobile market experienced production halts and demand slumps due to COVID-19 last year, Hyundai Motor maintained steady growth centered on domestic sales. The luxury brand Genesis surpassed 100,000 units sold domestically for the first time since its launch in 2015, and the large sedan Grandeur, known as the ‘people’s car,’ maintained its best-selling car status for the fourth consecutive year. Fueled by these records, Hyundai Motor sold 787,854 units domestically last year, marking the highest figure in 18 years since 2002 (790,000 units).

Kia Motors, which set an all-time domestic sales record of 552,400 units last year, is also expected to break its annual sales record. Kia’s sales consensus for last year is 59.3767 trillion KRW, predicted to increase by 2.1% compared to the previous year. Similarly, due to a large quality provision in the third quarter, Kia’s operating profit is forecasted to decrease by 11.2% to 1.7834 trillion KRW, and net profit is expected to decline by 23.8% to 1.392 trillion KRW.

If not for the large provisions, the combined operating profit of Hyundai and Kia Motors last year would have approached 8 trillion KRW, potentially recovering to the 2016 level (7.65 trillion KRW) before the THAAD (Terminal High Altitude Area Defense) crisis on the Korean Peninsula. This achievement is even more significant considering it was accomplished amid the COVID-19 crisis last year.

Rendering images of the Ioniq brand electric vehicle lineup (from left: Ioniq 6, Ioniq 7, Ioniq 5) / Photo by Hyundai Motor Group

This year, Hyundai and Kia Motors are expected to continue their momentum of performance improvement by declaring full-scale entry into the electric vehicle era. Starting with Hyundai Motor’s ‘Ioniq 5,’ scheduled for release as early as the first quarter of this year, followed by Genesis JW and Kia Motors’ CV, they plan to consecutively launch electric vehicles equipped with dedicated electric vehicle platforms, leading the popularization of electric vehicles in domestic and international markets.

Researcher Seonjae Song of Hana Financial Investment said, “The new car effect and mix improvement centered on domestic and North American markets, along with the continuous introduction of new electric vehicles through the adoption of dedicated electric vehicle platforms, are scheduled. These factors will offset the negative effects of exchange rates and drive profit growth for Hyundai and Kia Motors this year,” he forecasted.

This content was produced with the assistance of AI translation services.