Hyundai profits fall short of estimates as chip shortage continues to bite

  • Hyundai Motor returns profit of 1.3 trillion won ($1.10bn) for Q3 – a little off expectations
  • Chip shortage git Hyundai hard in third quarter
  • Company says it’ll enhance product mix with more SUVs and luxury models

Time 1 month ago

Hyundai Motor Company is continuing to be hit hard by the global shortage of semiconductors, its Q3 earnings show.

The Korean car giant posted a net profit of 1.3 trillion won ($1.10bn) for the July-September quarter, up from the loss of 336bn won in the same period last year when it was hit by a bout of quality-related engine issues and recalls.

The profit was a little off the analysts’ expectations of 1.4 trillion won, reported Reuters.

Global sales totalled 898,906 units, a 9.9 per cent decrease from a year earlier.

Sales in markets outside of Korea were down 6.8 per cent to 744,159 units, and sales in Korea decreased 22.3 per cent to 154,747 units.

Hyundai put the decrease in sales down to the ongoing chip shortage which it believes will continue to affect its performance in the fourth quarter.

In a statement, the company said: ‘Hyundai Motor expects that on-year sales growth might slow down for the rest of 2021 amid adverse business conditions caused by the unstable supply of semiconductor chips as well as potential unfavourable shift in the currency environment.

‘However, the company will continue to a proactively manage these issues.

‘Regarding the global chip shortage, Hyundai Motor expects the situation to continue affecting production in the fourth quarter. However, Hyundai is taking all necessary measures to minimise its impact.’

The company said it will ‘continue to enhance its product mix with more SUVs and luxury models and optimise production plan and sales strategies’.

Hyundai had been weathering the global chip shortage better than other carmakers in Q2, but it had to suspend production in the third quarter.

Earlier this month, Hyundai’s global chief operating officer Jose Munoz said the firm wanted to make its own chips in future.

James Batchelor's avatar

James – or Batch as he’s known – started at Car Dealer in 2010, first as the work experience boy, eventually becoming editor in 2013. He worked for Auto Express as editor-at-large and was the face of Carbuyer’s YouTube reviews. In 2020, he went freelance and now writes for a number of national titles and contributes regularly to Car Dealer.

More stories...

Server 190