SEOUL (AFP) – South Korea’s Hyundai Motor said yesterday that net profit surged more than 400 per cent in the second quarter (Q2) thanks to a recovery in global demand and solid sales of high-margin SUVs and luxury cars, but it warned of headwinds caused by the pandemic.
Hyundai, which with its affiliate Kia is among the world’s top 10 automakers, said net profit rocketed 425.5 per cent on-year to KRW1.98 trillion (USD1.7 billion).
Sales jumped 46.5 per cent to more than a million in the April-June period, with the huge leap helped by the very low base of comparison last year when the global economy was battered by coronavirus lockdowns.
However, the figure was supported by overseas demand, with sales up 73.6 per cent outside South Korea while domestically they fell 11 per cent.
“Sales of SUV models and Genesis luxury brand models drove the momentum in sales volume and declining incentives helped lift revenue,” the company said in a statement.
While a recovery from the pandemic “spurred automotive demand” among consumers, its sales “might slow down” in the second half of the year because of “the COVID-19 pandemic resurgence”.
To avoid output disruptions caused by a global chip shortage Hyundai said it would “secure additional supplies and strengthen cooperation with various semi-conductor partners”.
The pandemic has caused severe damage to global microchip supply chains with high demand for vehicles, consumer electronics and other key gadgets forcing Hyundai and other carmakers to suspend assembly lines on multiple occasions this year.