Hyundai Motor Group Chairman Chung Eui-sun. (Photo: Hyundai Motor Group)

Despite the shock caused by the COVID-19 pandemic, Hyundai Motor’s annual sales surpassed 100 trillion won last year for the second straight year.

Even though Hyundai Motor recorded negative growth, the automaker saw the portion of luxury cars and SUV models rise, contributing to improving operating profit.

In a conference call held at Hyundai Motor headquarters in Seoul on Jan. 26, the automaker announced its business performance for the fourth quarter of 2020.

Based on International Financial Reporting Standards (IFRS), Hyundai Motor sold 1,139,583 units in 2020 Q4 and posted 29.243.4 trillion won in sales - 23.479.6 trillion in the automobile business and 5.763.8 trillion won in financing and others.

The automaker chalked up 1.641 trillion won in operating profit, 1.521.7 trillion won in ordinary profit and 1.376.7 trillion won in net profit. Hyundai Motor’s annual sales surpassed 100 trillion won last year for the second year in row.

The automaker saw its operating profit decline to 2.781.3 trillion won, a 22.9 percent plunge over the previous year. The ratio of operating profit to sales fell to 2.7 percent, a 0.8 percentage point decline.

But Hyundai Motor posted 103.997.6 trillion won in 2020 sales. It is the second straight year that the automaker broke the 100 trillion won threshold in sales.

Net profit nosedived 33.5 percent to 2.117.8 trillion won. The automaker sold 3,744,737 units - 787,854 units in Korea, a 6.2 percent decline, and 2,956,890 units abroad, a 9.7 percent jump.

As for the 2020 Q4 business performance, a Hyundai Motor official said, “Sales are showing of signs of slow recovery in global demand for cars, but they declined compared to the previous due to the resurgence of the COVID-19 pandemic.”

But the automaker saw its operating profit improve with a wide margin on the back of the rising portion of luxury cars and SUV vehicles such as Genesis GV80 and G80, the official said.

Hyundai Motor saw the ratio of operating profit to sales rise to 5.6 percent in 2020 Q4, surpassing the 5 percent threshold for the first time since 2017 when it stood at 5.0 percent.

The feat was attributable to the automaker’s efforts to continuously improve a mix of new cars and focus on profitability-oriented management, the official said.

Improving of Operating Profit amid Minus Growth

Hyundai Motor sold 1,139,583 units in the global market in 2020 Q4, a year-on-year 4.7 percent drop.

On the other hand, the automaker sold 204,190 units in Korea in the fourth quarter, a year-on-year rise, on the back of rising sale of new cars such as Tucson, GV80 and G80 and Avante despite the resurgence of the COVID-19 pandemic.

In the global market, Hyundai Motor showed signs of sales recovery in North America and India, but the automaker saw sales decline year-on-year 6.6 percent to 935,393 units due to declining demand in Europe land developing economies, influenced by the effects of the pandemic.

2020 Q4 sales rose year-on-year 5.1 percent to 29,243.4 trillion won. Despite unfavorable business environment, such as declining global wholesales and a drop in the Korean currency against the dollar from 1,176 won in 2019 S4 to 1,118 won in 2020 Q4, the automaker saw sales rise on the back of improving of car product portfolio, coupled with expanding value-added new cars.