SEOUL, Jan. 25 (Korea Bizwire) – South Korea’s top automaker Hyundai Motor Co. suffered a huge setback in its profit in the fourth quarter of last year, the company said Wednesday.
Net profit came to 1.07 trillion won (US$918.5 million) in the three months ended Dec. 31, down 30.1 percent from the same period in 2015, the company said in a regulatory filing.
Sales slipped 0.9 percent on-year to 24.54 trillion won, despite a 3.2 percent drop in the number of cars sold over the cited period.
Operating profit tumbled 32.6 percent on-year to 1.02 trillion won, apparently reflecting a sharp increase in costs.
“The company’s profitability slowed from a year earlier in the fourth quarter, and this was largely due to a rise in the cost caused by massive missed production in the third quarter,” a company official said, while speaking on the condition of anonymity.
The fourth quarter operating profit marked the lowest quarterly earning since 2010, according to company officials.
For the entire year of 2016, the automaker posted a net profit of 5.72 trillion won, down 12.1 percent from 6.51 trillion won in the previous year.
Full-year sales gained 1.8 percent on-year to 93.65 trillion won, but operating profit tumbled 18.3 percent to 5.19 trillion won.
In 2017, the automaker said it planned to sell 5.08 million cars globally, with 683,000 vehicles sold in the local market.
The annual sales target will mark a 4.5 percent increase from 4,860,049 Hyundai cars that marked a 2.1 percent on-year drop in 2016.
“For such a growth in sales, Hyundai Motor will launch a number of new cars while expanding its presence in the global market for SUVs and green cars,” it said in a press release.
Hyundai Motor Group chairman Chung Mong-koo earlier said Hyundai Motor and its smaller affiliate Kia Motors Corp. will together introduce over 10 new vehicles this year in what many called one of the most aggressive launch schedules in history.
New Hyundai cars to be launched will include a small SUV, the company said earlier.
“The company will work to maintain and further boost its sales momentum created by the recent launch of the new Grandeur sedan by introducing new, improved versions of its key vehicle models, while also working to enhance its overall competitiveness by setting up a full line-up of SUVs,” a company official said.