Hyundai Q1 profit triples to highest in 4 years as luxury car demand booms

FILE PHOTO: A Hyundai Motor booth is seen near the Pyeongchang Olympic Plaza in Pyeongchang
Heekyong Yang
·1 min read

By Heekyong Yang

SEOUL (Reuters) -South Korea's Hyundai Motor Co said on Thursday first-quarter net profit jumped 187% to its highest in four years, in line with expectations, as demand for its high-margin sports-utility vehicles and premium Genesis cars boomed.

A global shortage of semiconductors, however, threatens to derail its growth momentum.

Hyundai, which together with affiliate Kia Corp is among the world's top 10 automakers by sales, reported a net profit of 1.3 trillion won ($1.16 billion) for the January-March period versus 463 billion a year earlier.

That compared with the 1.3 trillion won forecast of analysts in the Refinitiv SmartEstimate and was the highest since the March 2017 quarter.

Revenue rose 8.2% to 27.4 trillion won.

Demand for Hyundai's pricier cars such as SUVs and the luxury Genesis model stood out in the first quarter.

While major automaking rivals including Volkswagen and General Motors were forced to cut production due to the global shortage of semiconductors, Hyundai managed to stave off that in the first quarter thanks to its healthy chip inventory.

But the South Korean automaker too has begun to run out of semiconductors now, prompting it to temporarily pause production three times and save chips for its most popular models.

Shares of Hyundai Motor, Asia's fifth-biggest automaker by market value, rose 2% on Thursday after the results versus the broader market's 0.2% gain.

The stock is the third-best performer so far this year among large Asian automakers, gaining nearly a fifth.

(Reporting by Heekyong Yang and Joyce Lee; Editing by Muralikumar Anantharaman)

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