This photo provided by Hyundai Motor shows the front and side of the Genesis GV80 SUV.
SEOUL, Jan. 30 (Korea Bizwire) — Hyundai Motor Group’s three key affiliates posted stellar performance last year with their operating profit jumping 44 percent on a weak won and robust sales of sport-utility vehicle models.
For the whole of 2019, Hyundai Motor Co., Kia Motors Corp. and auto parts maker Hyundai Mobis Co. posted a combined operating profit of 8.05 trillion won (US$6.8 billion), up from 5.6 trillion won a year ago, according to the companies’ annual earnings results.
The companies reported an on-year growth in their overall operating income for the first time last year in seven years after their operating results continued to decline from 2013-2018, the data showed.
Analysts expected Hyundai Motor and Kia Motors will continue to benefit from higher demand for their SUV models in global markets, including the world’s most important U.S. automobile market, this year.
Strong sales of Hyundai’s flagship Palisade and entry-level Kona SUVs and Kia’s Telluride SUV buoyed the companies’ bottomline last year.
The Telluride, produced in Kia’s Georgia plant, was launched in the U.S. last year and sold only in North American markets.
The SUV models are expected to continue to support Hyundai and Kia’s earnings this year, with new models such as Hyundai’s Tucson SUV, its independent brand Genesis’ GV80 SUV, and Kia’s Sorento SUV set to be launched in the U.S. market during the year.
“Increased sales of those value-added SUV models helped improve Hyundai and Kia’s product mix. And friendly exchange rates also helped their annual earnings results,” a Hyundai spokesman said.
The dollar rose to an average of 1,175.81 won in the fourth quarter from 1,127.52 won a year earlier, according to the Bank of Korea.
A weak won makes South Korean exports more price-competitive in overseas markets and lifts the value of repatriated profits.
Kia Motors Corp.’s Telluride SUV. (image: Kia Motors)
Hyundai Motor said it will continue to focus on improving profitability to achieve an operating profit margin of 5 percent this year, higher than the 3.5 percent it posted last year.
Kia said it aims to achieve an operating profit margin of 6 percent in 2025 from 3.5 percent last year.
Hyundai and Kia, which together form the world’s fifth-biggest carmaker by sales, aims to sell 7.54 million vehicles in 2020, up 4.9 percent from 7.19 million units they sold last year.
Hyundai Mobis’ operating profit advanced last year as it earns 90 percent of its overall auto parts sales from the country’s two biggest carmakers.
The auto parts firm aims to achieve $2.73 billion worth of orders globally, higher than $1.76 billion orders it obtained from global carmakers last year.
The three firms’ net profit soared 58 percent to 7.39 trillion won in 2019 from 4.69 trillion won, while sales rose 8.5 percent to 201.99 trillion won from 186.13 trillion won during the cited period.
Earlier this month, the Korean automotive group said it will invest more than 100 trillion won in the next five years to increase its presence in the future mobility markets.
“We are planning to launch 44 electrified vehicles, including 11 all-electric models, by 2025, as we aim to take the lead in electrified car markets based on the development of our own platforms and core electrified car components,” Hyundai Motor Group Executive Vice Chairman Chung Euisun said in his New Year message to employees.
In 2019, the group sold 24 kinds of electrified models in global markets, and it plans to expand the lineup to 13 gasoline hybrid, six plug-in hybrid, 23 all-electric and two hydrogen fuel-cell electric models by 2025.
(Yonhap)
