Hyundai Motor logs solid profits despite Q1 sales dip

SEOUL, April 26 (UPI) -- South Korean automaker Hyundai Motor's global sales in the first quarter dipped almost 10% from a year prior, but its overall revenues jumped, the firm said.

The Seoul-based company said Monday it sold 902,945 vehicles in the first three months of this year, down 9.7% from a year before. But its revenue and operating profit rose 10.6% and 16.4% year-on-year, respectively.

Hyundai's operating profit of $1.5 billion was higher than the market average of $1.3 billion.

Hyundai attributed its decreased sales figure to the shortage of semiconductor chips and other automotive components.

"Robust sales of SUV and Genesis luxury models, declining incentives and a favorable foreign exchange environment helped lift our revenue in the first quarter, despite the slowdown in sales volume amid an adverse economic environment," Hyundai said in a statement.

Hyundai's sister company Kia reported an operating income of $1.3 billion during the January-March period, up 49.2 percent from 2021. Its revenue amounted to $15 billion.

Kia said its enhanced product mix, which includes higher-margin recreational vehicle models like Sorento and Sportage, supported its solid performance.

Shares of Hyundai Motor and Kia jumped 2.75% and 4.9%, respectively, on the Korean stock exchange Tuesday.

Observers said that Hyundai and Kia will have to deal with lingering economic uncertainties through the rest of 2022.

"I predict that global car brands will see a gradual recovery of demand this year as the global pandemic and chip shortage issues ease up," Daelim University automotive Professor Kim Pil-soo told UPI News Korea.

"But there still is a supply chain disruption caused by the lockdown in some Chinese cities and Russia's war in Ukraine. There are many uncertainties for global automakers," he said.