Hyundai Profits Quintuple on Strong China, India Sales

Hyundai Motor said net profit hit a record high in the first quarter amid a jump in sales and strong performance in China and India.

Hyundai, South Korea’s biggest automaker and a rising force in the global industry, earned 1.13 trillion won ($1.02 billion) in the three months ended March 31, it said in a regulatory filing Thursday.

That was five times higher than net profit of 225 billion won in the same period last year. Company spokesman Ki Jin-ho said the net profit figure was an all-time high on a quarterly basis.

The maker of the Elantra and Sonata sedans and the luxury Genesis also said quarterly sales rose 39.6 percent to 8.42 trillion won from 6.03 trillion won a year earlier.

The company’s global sales volume during the quarter jumped 36.6 percent from a year earlier to 842,037 vehicles.

Hyundai Motor Co., which along with affiliate Kia Motors Corp. forms the world’s fifth-largest automotive group, has seen its market share grow in recent years through an emphasis on quality and design.

Global market share rose to 4.8 percent in the first quarter of 2010 from 4.7 percent the year before, according to Ki, the spokesman

Hyundai said in January that market share in 2009 rose to 5.2 percent from 4.3 percent in 2008 and that it is targeting an increase to 5.4 percent this year. The company sold a record 3.11 million vehicles in 2009.

Hyundai showed strong performance in China, India and the United States during the first quarter.

Sales volume and revenue in China jumped 48.1 percent and 22.6 percent, respectively, from the year before, Hyundai said in presentation materials for investors.

In India, sales volume increased 33.5 percent, while revenue rose 20.8 percent.

Sales volume in the United States rose 78.3 percent and revenue gained 61.5 percent. But the U.S. performance contributed less to profits than China and India amid a 19 percent decline in the dollar against the South Korean won in the first quarter from the year before, Hyundai said.

A stronger won can reduce profits South Korean companies earn overseas when they are repatriated back home.

Michael Sohn, auto analyst at Woori Investment & Securities in Seoul, attributed the company’s strong performance in the U.S. to increasing brand and quality recognition among consumers and not recall woes at rival Toyota Motor Corp. of Japan, which he said benefited U.S. manufacturers more than Hyundai.

“The product is better and people (see) Hyundai as a better brand than before,” Sohn said. “I think simply brand awareness is going up.”

Sohn said Hyundai’s U.S. market share increased to 4.4 percent from 4.3 percent the year before.

Both Hyundai and Kia have expanded aggressively overseas. Hyundai has factories in China, India, Turkey, the U.S. and the Czech Republic. Kia has plants in China and Slovakia and began production in the United States last year.

Hyundai has two factories each in China and India and is planning a third in China.

Shares in Hyundai Motor, which released results during afternoon trading, rose 0.4 percent to close at 125,000 won. The company’s stock price tripled in 2009.

Kia is scheduled to announce first-quarter earnings results Friday.

KELLY OLSEN, AP Business Writer SEOUL, South Korea