Hyundai Motor’s’Genesis + SUV’ effect… 4Q operating profit 1.6 trillion won

A citizen is looking at a vehicle at the Hyundai Motor Showroom in Daechi-dong, Seoul. [연합뉴스]

Even in the aftermath of the novel coronavirus infection (Corona 19), Hyundai Motor Company recorded an operating profit of 1.6 trillion won in the fourth quarter of last year. In particular, 4Q operating profit increased by more than 40% from the same period a year ago, which is a result of the added effects of sports utility vehicles (SUVs) such as Tucson and Palisade and new cars of Genesis. Hyundai Motor Company plans to target the eco-friendly car market by releasing four models of electric vehicles this year.

Hyundai Motor Company announced on the 26th that “in the fourth quarter of last year, sales recorded 29.4 trillion won and operating profit 1.64 trillion won.” Compared to the same period last year, sales increased by 5.1% and operating profit by 40.9%. Seo Kang-hyun, head of the Hyundai Motors Finance Division (Vice President) explained, “The sales volume in the fourth quarter decreased compared to last year due to the re-proliferation of Corona 19, but the sales of Genesis luxury cars and SUVs such as GV80 and G80 increased significantly, and operating profit improved significantly.”

Hyundai Motor Company’s Recent Operating Profit Trends = Reporter Kim Young-ok [email protected]

The operating margin (5.6%) recorded by Hyundai Motor in the fourth quarter of last year exceeded the 5% barrier in 13 quarters after the third quarter of 2017 (5%). Although it did not reach the double-digit operating margin recorded in 2012-2013, it is evaluated that it has rebounded considerably compared to the time when it fell to the 1% level (3Q 2018).

However, Hyundai Motor’s annual sales of last year were 103.998 trillion won, a 1.7% decrease from the previous year (105.75 trillion won). Annual operating profit (2.8 trillion won) also decreased by 23% compared to 2019 (3,61 trillion won). In particular, the sharp decline in operating profit seems to have been affected by the reflection of about 2.4 trillion won in the name of the’Theta 2’engine and other quality provisions in 3Q results.

In addition to the earnings announcement on the day, Hyundai Motor Company clearly revealed the launch schedule of the first exclusive electric vehicle,’Ioniq 5′. Ja-Yong Koo (Executive Vice President of Hyundai Motor Company) explained that “Ioniq 5 will be released in the Korean and US markets sequentially starting in March, starting in Europe.” Ioniq 5 is equipped with an electric vehicle exclusive platform (E-GMP) developed by Hyundai Motor Company. Hyundai Motor Company, however, did not make any special comments regarding the recent EV cooperation with Apple.

Teaser image of Ioniq 5, the first time Hyundai Motor Company applied E-GMP, an electric vehicle platform. [사진 현대차]

Hyundai Motor Company had a cautious outlook on the automobile market this year. Hyundai Motor Company is diversifying its lineup from’A·So·G’ (Avante, Sonata, Grandeur) sedans to Genesis SUVs and electric cars this year. Executive Vice President Ja-Yong Koo predicted, “The demand recovery in the automobile market will appear due to the effects of economic stimulus policies in each country, but it is difficult to expect a recovery to the level before Corona 19. A difficult business environment such as intensifying competition and unfriendly exchange rates will continue.”

Reporter Kim Young-min [email protected]