Hyundai, Kia Suffer Worst Earnings in 7 Years
28 January, 2018
Hyundai and affiliate Kia have posted the worst operating profit in seven years.
The two automakers announced last year's performance on Thursday, which showed sales rising slightly, but growing costs due to a strong won and China's unofficial boycott of Korean products took a toll on their earnings.
Massive provisioning to make up for a shortfall in wages after a court decision to repay employees also hurt the bottom line.
Hyundai sold 4.5 million cars around the world last year to generate W96.4 trillion in sales, up 2.9 percent from 2016 (US$1=W1,064). But operating profit plunged 11.9 percent to W4.57 trillion.
Kia sold 2.76 million cars, generating W53.5 trillion in sales, up 1.6 percent on-year. But it had to set aside W1 trillion to make up for additional wages, so operating profit fell 73.1 percent to W662.2 billion.
Hyundai blamed the poor profitability on strikes that caused production delays and slow sales in major markets.
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