Kia Motors has forecast a 24% rise in 2005 sales to 1.34 million units, underpinned by solid foreign demand and an expected pickup in weak domestic sales.
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The affiliate of Hyundai Motor Co., expects 2005 sales to be worth $US19.34 billion, Reuters reported.
The report said Kia’s rosy outlook for this year compares with a near 14% rise to 2.39 million units forecast by Hyundai, which controls half the home market and is aiming to lift its sales, combined with Kia, into the global top five by 2010, but noted that analysts said the outlook for 2005 remained murky.
“A softer dollar weakens export competitiveness in terms of prices, and a global trend of higher interest rates will make consumers more hesitant about auto purchases,” Kim Hag-ju, an auto analyst at Samsung Securities, told Reuters. “Whether Hyundai Group will continue to increase its global market share hinges on how many customers its new models can continue to attract despite this unfavourable environment.”
Exports make up 60% of Hyundai Motor’s earnings, Reuters said.
The Hyundai Motor Group aimed to boost investment by nearly 24% to a combined $6.51 billion in 2005 as it sought to upgrade global networks in the United States, China and Europe, the company said in a statement cited by the news agency.
Hyundai Motor reportedly said it would boost investment this year to $2.68 billion, up 3.3% from last year, while Kia would raise investment to $1.87 billion, up 26% from $1.47 billion.
Hyundai expects exports to grow 15.3% to 1.78 million units this year. Kia expected its exports to rise to 1.03 million units from 827,000 units last year, Reuters said.
The report said that the country’s five car makers increased exports by 35.6% to 369,514 units in December, taking total sales up 25% to 467,042. Domestic sales fell 3% to 97,528.
