Hyundai Motor Group overtook Volkswagen Group as the world’s second most profitable carmaker in the first half, indicating the leading South Korean automaker may have coped with US President Donald Trump’s tariffs better than the German rival.
Hyundai Motor Group, the world’s third automaker by sales volume with three brands – Hyundai Motor Co., Kia Corp. and the premium Genesis – reported an operating profit of 13 trillion won ($9.3 billion) in total during the January-June period, according to the industry sources on Sunday.
The conglomerate’s operating profit margin was 8.7% based on sales of 150.1 trillion won.
Volkswagen Group, the world’s No. 2 carmaker by sales volume with various brands such as Volkswagen, Audi, Porsche, Bentley and Lamborghini, logged an operating profit of 6.7 billion euros ($7.8 billion) in the first half.
Its operating margin was 4.2%, given the group’s sales of 158.3 billion euros during the period.
Toyota Motor Corp., the world’s largest automaker, was the most profitable carmaker with an operating profit of 2.3 trillion yen ($15.4 billion) with sales of 24.6 trillion yen. Its operating profit margin was 9.2%.
The Japanese automaker sold 5.2 million vehicles across the world in the first half, followed by Volkswagen Group with 4.4 million units and Hyundai Motor Group with 3.7 million.
TO STAY AHEAD OF VOLKSWAGEN
Despite the lower sales, Hyundai Motor Group is expected to outpace Volkswagen Group in terms of profitability this year if the South Korean conglomerate effectively copes with the risks of US tariffs and the prolonged downturn in the global electric vehicle demand, industry sources in Seoul said.
Hyundai Motor Group reported tariff costs of about 1.5 trillion won in the second quarter, smaller than Toyota’s 4 trillion won, according to the sources.
Hyundai Motor Co., South Korea’s No. 1 carmaker, reported its first double-digit profit fall in five years in the second quarter despite posting record second-quarter sales, hit by the US government’s 25% tariffs on foreign-made cars, implemented in April.
The US tariffs on South Korean vehicles were slashed to 15%. Hyundai Motor Co. and Kia were expected to save more than 3 trillion won, cutting their total US duty burden to 5.61 trillion won, according to Korea Investment & Securities Co.
By Bo-Hyung Kim
kph21c@hankyung.com
Jongwoo Cheon edited this article.
