Hyundai Motor held a management performance conference call on the 26th

“We know that there are some hurdles in the demand for electric vehicles,” said Seo Kang-hyun, vice president of Hyundai Motor’s planning and finance division, during a conference call on the third quarter’s earnings announcement. “However, electric vehicles will continue to grow, and we are not thinking about reducing electric vehicle production and slowing down development because of the hurdles.”

“Then there is a question of whether to revise the sales plan, but basically, when we make a business plan, we don’t have a long-term plan that has been established once,” he said. “Although next year’s sales plan may be slightly lowered by electric vehicle type, it will not have a significant impact on total sales.”

“When the paradigm changes, the strategy is linearly woven, but the actual situation usually changes step by step,” he said. “I understand that electric vehicles also have such a reaction (to demand) due to constraints on charging and prices.”

Vice President Seo then nailed, “The U.S. (Georgia Electric Vehicle) plant has no plans to delay the mass production schedule in the second half of 2024 as we proceed quickly with decisions in terms of benefits from the Inflation Reduction Act (IRA).”

Hyundai has proposed a mid- to long-term goal of producing and selling 940,000 electric vehicles by 2026 and 2 million electric vehicles by 2030. This is an increase of 100,000 units in 2026 and 130,000 units in 2030, respectively from the original plan.

In addition, Hyundai Motor Group Metaplant America (HMGMA) will be established in Georgia, USA, with the aim of starting mass production in the second half of 2024, in response to the IRA, which subsidizes only North American electric vehicles.

In Korea, a factory dedicated to Ulsan electric vehicles is being built to mass-produce them in 2025.

In addition, Hyundai Motor said it would respond to the increase in costs by reducing costs in connection with the agreement to raise the wages of automobile workers by 25% over four years due to the UAW strike.
The cumulative operating profit exceeded 11 trillion won in the first three quarters of this year. However, compared to the last two quarters, the performance fell slightly.

Hyundai Motor held a management performance conference call on the 26th and announced that its operating profit in the third quarter of this year was KRW 3.82 trillion, up 146.3% from the same period last year.

The operating profit was the largest ever operating profit in the third quarter and exceeded the market forecast of 3.6 trillion won compiled by Yonhap Infomax by 0.62%.

Hyundai Motor’s previous best performance in the third quarter was 2.989 trillion won in the third quarter of 2011.

The cumulative operating profit for the first three minutes of this year was 11.6524 trillion won, nearly doubling from 6.46 trillion won in the same period last year.

It is also a figure that has already exceeded Hyundai Motor’s operating profit of KRW 9.81 trillion recorded last year.

Some predict that if Hyundai Motor continues this performance, its annual operating profit will exceed KRW 15 trillion.

Operating profit in the third quarter decreased 9.8% compared to the previous quarter (4.237 trillion won).

Revenue rose 8.7 percent year-on-year to 41.27 trillion won (32.31 trillion won for automobiles, 8.69 trillion won for finance and others). Net income rose 134 percent to 3.335 trillion won. However, compared to the previous quarter, sales and net income fell 3.0 percent and 1.3 percent, respectively.

Hyundai Motor said, “Sales in the third quarter of this year increased year-on-year based on solid sales growth in major regions such as North America, Europe, and India. Operating profit increased significantly year-on-year due to positive factors such as expanding the number of sales and improving mix centered on high value-added models.”

Hyundai sold 1,045,510 units in the global market in the third quarter of this year. This is a 2.0% increase year-on-year.

In the domestic market, 166,969 units were sold, up 2.8% year-on-year, due to increased sales centered on sports utility vehicles (SUVs) along with positive responses from consumers to the newly launched “Dior New Santa Fe” in August.

In the overseas market, 878,541 units were sold, up 1.9% from the same period last year, due to strong sales in major markets such as North America, Europe, and India, along with increased production due to improved parts supply and demand conditions.

The number of global eco-friendly cars sold increased 33.3% year-on-year to 168,953 units due to the strengthening of the hybrid lineup and the expansion of sales of the dedicated electric vehicle brand “Ionic.”

An official of Hyundai Motor said, “The demand in major markets continues to increase sales,” adding, “Based on the low inventory level and the effects of new cars such as the new Santa Fe, annual sales growth is expected this year.”

However, he added, “The uncertain business environment is expected to continue due to the possibility of fluctuations in the external macroeconomics, such as geopolitical risks in the Middle East and high interest rate levels.”

“In the fourth quarter, uncertainties will expand, including interest rate hikes, the Israel-Hamas war, the prolonged Russia-Ukraine war, and rapid changes in the electric vehicle market environment,” said Seo Kang-hyun, vice president of Hyundai Motor’s planning and finance division, in a performance conference call. “We expect to continue to grow and achieve near the top of our annual guidance.”

Meanwhile, Hyundai Motor has set a dividend of 1,500 won (based on ordinary shares) in the third quarter, just like in the second quarter.

Hyundai Motor said, “We plan to continue to return shareholders through continuous quarterly dividends, easing stock volatility and continuing to increase the attractiveness of long-term stock holdings.”

Vice President Seo said, “We expect that the Alabama plant and HMGMA that we are building now will also be affected by wage increases. However, we will have to negotiate whether we should go with the same amount of 25 percent.”

He added, “We are continuing to make efforts to reduce other logistics costs, and we believe that the cost of raw materials can be sufficiently covered by cost-cutting factors, etc., falling compared to when the cost of raw materials rose at the peak.”

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