Big Money Problems
Hyundai Motor Group, which ranked third in the world in 2022 in terms of sales volume, joined the global top three in both operating profits and operating margins.
In the second quarter of this year, Hyundai Motor Group’s operating profit ranked third behind Toyota and Volkswagen Group, which are volume-oriented mass market brands. In terms of operating profit margin, it ranked after luxury brands Mercedes-Benz Group and BMW Group.
Hyundai Motor and Kia Corp. posted combined sales of 68.43 trillion won (US$53.51 billion) and combined operating profits of 7.64 trillion won in the second quarter on a consolidated basis, according to Hyundai Motor Group on July 27. Their combined sales and operating profits increased 18.3 percent and 46.6 percent, respectively, from the second quarter of 2022. The combined operating margin of the two companies reached double digits at 11.2 percent.
Observing second quarter results of major automakers, Hyundai-Kia’s combined operating profit ranked third in the world, behind Toyota (8.4383 trillion won in a forecast) and Volkswagen Group (8.0328 trillion won).
Their combined operating margin sat behind Mercedes-Benz Group (13 percent) and BMW Group (11.3 percent in a forecast). Hyundai Motor Group’s performance encompassed both mass market and luxury brands.
Hyundai Motor Group could enjoy double-digit operating margins alongside Mercedes-Benz and BMW thanks to its upscale strategy. “Compared to Volkswagen Group and Toyota, Hyundai Motor Group sells a higher proportion of recreational vehicles (RVs) and has more standard comfort and safety features for its models,” said Lim Eun-young, a senior researcher at Samsung Securities. “While Volkswagen and Toyota mainly sell base models in the United States, Hyundai and Kia offer advanced driver assistance systems (ADASs) as a basic feature.”