Hyundai Motor and affiliate Kia Motors have posted sharply lower operating profits.
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Hyundai posted a quarterly operating profit 9% down year on year at 581bn and below a 638.6bn won forecast.
October to December quarter net profit was 243.6bn won, versus 338bn won a year ago, and well short of a 513.5bn won forecast by 11 analysts in a Reuters poll.
Quarterly sales rose 1% to 8.83 trillion won.
Kia posted a fourth-quarter operating profit of only 35.9bn won, well below a 157bn won forecast by analysts.
Hyundai’s full-year 2009 net profit is seen at 1.81 trillion won ($1.32bn), compared with 1.45 trillion won last year, while Kia’s net profit is forecast at 472.1bn won, up from 113.8bn won last year, according to Reuters Estimates.
The pair are expected to benefit from a weak won and the smaller cars they offer, analysts told Reuters.
“What is concerning is a weaker auto financing market. If the market stays sluggish, that will hurt lower-incomers who could be Hyundai’s major customers for smaller cars,” KB Investment & Securities analyst Sunny Sohn told the news agency.
“Still, Hyundai is much better positioned than its Japanese and US competitors.”
Reuters noted that the South Korean won fell by nearly one third against the dollar in October-December while the Japanese yen rose by almost a quarter against the dollar last year, making Japanese cars less competitive and cutting overseas earnings.
In contrast to JD Power’s estimates overall global auto sales will fall at least 8% in 2009, analysts expect Hyundai’s annual sales to dip just 0.5% to 2.64m this year while Kia’s sales are seen down only 0.4% at 1.34m, according to Reuters polls.
