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Ssangyong Motor Sees Mounting Losses despite High Sales of Tivoli
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Ssangyong Motor Sees Mounting Losses despite High Sales of Tivoli
  • By Jung Min-hee
  • July 24, 2015, 07:15
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The Ssangyong Tivoli.
The Ssangyong Tivoli.

 

Ssangyong Motor Co., owned by India’s Mahindra & Mahindra, announced on July 23 that it sold a total of 69,800 cars, including 45,410 units in the domestic market and 24,390 units in the overseas market, in the first half of this year. The company also said that it posted 1.6 trillion won (US$1.37 billion) in sales, 54.1 billion won (US$46.6 million) in operating losses, and 53.9 billion won (US$46.43 million) in net losses. Despite the sales increase in the domestic market, the sales and the operating profit in the first half of this year decreased by 6 percent and 7.7 percent, respectively, from a year earlier due to the export decrease.

Thanks to the sales increase of the Tivoli crossover SUV, domestic sales, which shows the biggest growth rate in the industry, surged 36.6 percent year-on-year to 45.410 units. The company recorded the highest half-yearly sales in 11 years after the first half of last year. In particular, the robust domestic sales were driven by a strong demand for the Tivoli, which is popular in the compact SUV market. The Tivoli’s monthly sales recorded over 3,000 units for three months in a row since April. Its first-half cumulative sales came to 18,000 units.

However, Ssangyong Motor saw its exports plunge by 40.5 percent from a year ago, affected by a slump in major emerging markets including Russia and other unfavorable market conditions such as the weak euro. The company expects to see gradual export expansion, as it is selling a diesel version of the Tivoli in the global strategic markets, including Europe and China, from June.

With the sales growth of the Tivoli, the sales and the profits in the second quarter increased by 12.1 percent and 9.9 percent, respectively, from the previous quarter. Accordingly, the company recorded 19.9 billion won (US$17.14 million) in operating losses, down 41.8 percent from the first quarter.

SsangYong Motor CEO Choi Jong-sik said, “With the release of the Tivoli, which is becoming a sensation in the market, the company has recorded the biggest growth rate in the industry in the domestic market. As the Tivoli line-up is strengthening further with the release of the gasoline, diesel, and four-wheel drive versions of the Tivoli in the second half of the year, its profitability will also gradually improve.”