Hyundai Motor's second-quarter operating profit fell more than 20% year-on-year due to rising costs and production losses
The company said on Thursday that its second-quarter net profit fell 11.2% year-on-year due to rising costs and production losses. The company said in a press release that net profit fell to 2.88 trillion won (about $2 billion) in the three months ended June from 3.25 trillion won in the same period a year earlier. "Quarterly profit was impacted by higher raw material costs and production losses due to fires at key component suppliers," the company said. Operating profit fell by 20.8% year-on-year, from 3.6 trillion won in the same period last year to 2.85 trillion won; revenue increased by 1.9%, from 48.28 trillion won in the same period last year to 49.21 trillion won. The company said revenue growth was driven by strong sales of high-margin hybrid vehicles and favorable currency despite rising production and marketing costs. Looking ahead, Hyundai Motor said global economic uncertainty and intensifying competition in the automotive industry are expected to continue to pose major challenges in the second half of the year. To address these challenges, the company plans to strengthen its growth momentum by launching new models, including the new Avante compact sedan and a hybrid version of the New Grandeur sedan. Hyundai also said it would maintain contingency plans to deal with downside risks, including U.S. tariffs. The company said it remains committed to achieving sales growth of 1% to 2% and vehicle sales of 4.158 million vehicles in 2026. In the first half of this year, Hyundai Motor's net profit fell 17.5% year-on-year, from 6.63 trillion won in the same period last year to 5.47 trillion won. Operating profit fell 25.8% to 5.36 trillion won from 7.23 trillion won in the same period last year. Sales increased by 2.7% year-on-year to 95.15 trillion won.