SEOUL, KOREA - Hyundai Motor and Kia Motors are narrowing their sales gap with Toyota in the global market.The combined global sales of Hyundai Motor and Kia Motors are estimated at 4.04 million units in the first half of this year, chasing Toyota’s 5.08 million units (estimates).
The profitability of Hyundai Motor and Kia Motors, however, is at risk due to unfavorable foreign exchange movements.
Unlike Toyota which flied high thanks to the low yen, the two Korean car makers are expected to be trapped in an earnings structure which is characterized by high sales and low margins.
According to industry sources on July 15, Hyundai Motor and Kia Motors, which are expected to reveal their second-quarter results within next week, are estimated to have suffered a negative year-to-year growth due to the impact of the hike in the won’s valuevis-à-vis major currencies.
The market consensus on Hyundai Motor’s second-quarter operating profit and net profit is 2.22 trillion won and 2.38 trillion won, respectively, down 5-7 percent from a year ago, while those of Kia Motors are 858.7 billion won and 975.4 billion won, down 17-23 percent year on year.