Hyundai auto group reports worst earnings in eight years

[Courtesy of Hyundai]

SEOUL, Jan. 25 (Aju News) -- South Korea's Hyundai auto group reported its worst corporate earnings in eight years due to a strong won, slowing demand in major markets and a diplomatic row with China over the deployment of a U.S. missile shield.

Hyundai Motor said its full-year net profit in 2017 fell 21 percent on-year to 4.54 trillion won (4.29 billion US dollars). Operating profit was down 12 percent to 4.57 trillion won last year while sales rose 2.9 percent to 96.37 trillion won.

The company said its profitability was undermined by the won's strength against the dollar and competition with rivals in China and other major markets as well as increased marketing costs. In China, Hyundai's auto sales fall 31 percent on-year to 785,006 units last year.

In the fourth quarter, net profit rose 21 percent on-year to 1.29 trillion won thanks to reduced corporate taxes in the United States. Fourth-quarter operating profit fell 24 percent to 775.2 billion won, and sales fell 0.2 percent to 24.5 trillion won.

Kia's earnings also were the worst since 2010 for similar reasons. Its full-year net profit plunged 64.9 percent to 968 billion won. Operating profit was down 73 percent to 662 billion won and sales increased 1.6 percent to 53.53 trillion won.

For 2018, the world's fifth-largest auto group has set a goal of selling 7.5 million vehicles together, citing slow global economic growth and weak demand in major markets.

Lim Chang-won cwlim34@ajunews.com

Hyundai auto group reports worst earnings in eight years

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