Yong Hwan-jin and Lee Ha-yeon
South Korea’s auto giant Hyundai Motor Co. and its sibling Kia Motors Corp. that shocked the market with dismal twin third-quarter results on faltering sales at home and abroad will likely miss their combined annual sales target of 7,550,000 units for this year for the fourth straight year with sales likely dwindled by 9 percent from their peak year of 2015.
Hyundai Motor and Kia Motors said Tuesday that they sold a total of 6,094,688 units in the first 10 months of this year. Hyundai Motor sold 3,770,916 cars, up 2.6 percent from a year-ago period, and Kia Motors sold 2,323,772 units, up 2.7 percent from the previous year.
Despite the on-year gain in sales, both automakers are expected to miss this year’s targets guided in January - 4,675,000 units for Hyundai Motor and 2,875,000 units for Kia Motors - considering the pace of monthly car sales.
Combined monthly sales of Hyundai Motor and Kia Motors averaged 609,469 units as of October. Considering that their monthly car sales volume stays at the average level in the next two months, they would sell total 7,313,626 units for full 2018, only 96.9 percent of their target of 7,550,000 units for this year.
If they miss the target again this year, it would be their fourth year in a row to underperform.
Hyundai Motor and Kia Motors sold 8,012,995 units in 2015, falling short of the 8,200,000 target, 7,880,266 cars in 2016 below a target of 8,130,000 units and 7,252,496 units in 2017 below a target of 8,250,000 cars. Earlier this year, the country’s two largest carmakers presented a much conservative sales target of 7,550,000 units for 2018 on concerns that they would continue to lose ground in the two major markets in the United States and China.
Their bottom-line was more shocking than top-line.
Hyundai Motor announced an operating profit of 288.9 billion won ($257.2 million) in the third quarter, down 70 percent on quarter and 76 percent on year. Kia Motors also reported that its third-quarter operating profit plunged 66.7 percent on quarter to 117.3 billion won.
At 1:14 on Tuesday, shares of Hyundai Motor rose 3.37 percent to 107,500 won, and Kia Motors shares gained 2.12 percent to 28,900 won.