Despite low inventory levels that affected sales in North America and their home market of Korea, Hyundai Motor Co. announced near record profits for the second quarter of 2013, powered by good results in China. Hyundai reported net profits of 2.52 trillion Korean won ($2.26 billion), down just slightly from last year but beating analysts expectations. Operating profit was 2.41 trillion won ($2.16 billion) on revenues of 23.18 trillion won ($208.39 billion).
Bucking a slowing Chinese market, Hyundai sales there were up 36% in the first half of 2013 following the start of production at the company’s third Chinese assembly plant, the launch of a local version of the Elantra, and decreased sales of Japanese brands due to the dispute between China and Japan over the Senkaku/Diaoyu islands.
Sales in its home market of South Korea fell 0.7% while U.S. sales were up slightly 1.2%. Hyundai sales in both of those markets were hampered by a labor dispute over wages and overtime affecting their Korean operations, reducing supply. Also, competitors in the critical compact and midsize segments have introduced many new models, while Hyundai’s bread and butter Elantra and Sonata are among the oldest in that segment. To move the metal, Hyundai has cut prices and increased incentives. The relatively flat results in North America means that the company has been losing market share.
In Europe, where sales are at the lowest point they’ve been in 20 years, Hyundai’s sales were off 9 percent.