Hyundai Motor posts 150 percent surge in Q3 profit

Industry

Published: 26 Oct. 2023, 14:36 Updated: 26 Oct. 2023, 17:18

Hyundai Motor posts 150 percent surge in Q3 profit

Hyundai Motor Group Executive Chair Euisun Chung shakes hands with a Hyundai Engineering & Construction employee during his visit to the construction site of a tunnel at The Line, a residential area of Saudi Arabia’s mega-project NEOM City, on Monday. [HYUNDAI MOTOR]

Hyundai Motor's operating profit surged nearly 150 percent in the third quarter on strong sales of high-margin SUVs and EVs.

The Korean automaker reported 3.8 trillion won ($2.8 billion) in operating profit during the July-to-September period, up 146.3 percent on year, beating the market consensus of 3.62 trillion won compiled by FnGuide.

The quarterly figure is a record-high figure for any third quarter in the company's history, Hyundai said.

Revenue rose 8.7 percent to 41 trillion won, also overshooting market expectations of 40.2 trillion won.

Net profit stood at 3.3 trillion won, up 134 percent on year.

“Sales increased thanks to boosted sales of premium Genesis vehicles and Ioniq EVs,” said Seo Gang-hyun, the company's executive vice president of finance and accounting, in a conference call Thursday. “Sales grew for vehicles shipped overseas including the North American region, Europe and India.”

Hyundai Motor workers inspect Elantra sedan at the company's Ulsan plant last week. [HYUNDAI MOTOR]

Hyundai Motor sold a total of 1.05 million vehicles globally in the third quarter, up 2 percent on year.

Domestic sales rose 2.8 percent to 167,000 during the period, driven by the popularity of SUVs.

Overseas sales were only up 2 percent to 878.541, with sales growing most in the North American market. It sold a total of 275,000 vehicles in North America, up 12.8 percent on year, and 153,000 in Europe, up 8 percent.

Overseas sales did not live up to expectations, but Seo said it “aims to raise that more dramatically with the newly launched Santa Fe in the U.S. market.”

Overall sales of eco-friendly vehicles jumped 33.3 percent to 168,953 on the increased sales of Ioniq 5s and 6s. Eco-friendly cars also include hybrid cars.

Hyundai is set to release the Ioniq 7 SUV next year.

Seo also said everything is going according to plan for Hyundai's $5 billion EV-dedicated factory in Georgia. It advanced the start of mass production to the second half of 2024 from the first half of 2025.

“It was a quick decision made to allow Hyundai vehicles to qualify for the Inflation Reduction Act [IRA] tax credit,” Seo added.

But Seo also expressed concerns about the ongoing United Auto Workers (UAW) strike in North America. Ford recently decided to raise the wages of its employees by 25 percent after a series of negotiations with UAW.

“The strike may cause a wage hike for workers in Hyundai's Alabama and Georgia plants in the future, but it doesn't have to be on the same level with Ford,” Seo said.

Hyundai Motor shares closed at 179,500 won Thursday, down 1.4 percent.

Kia plans to announce its third quarter earnings report Friday.

BY SARAH CHEA [chea.sarah@joongang.co.kr]