The increase in sales was driven by strong sales of high-profit vehicles such as hybrid cars and Genesis sales in the North American market. According to IR data, Hyundai Motor's sales in North America last year increased 5.9% year-on-year in retail sales and 9.9% in wholesale sales.
Sales of eco-friendly cars have also increased overall. The total global sales of eco-friendly cars last year were 757,000 units, up 8.9% from the previous year (695,000 units). Sales of pure electric vehicles decreased due to the phenomenon of electric vehicle catharsis (slow demand), but hybrid vehicles received all the decreases. Global hybrid car sales increased by 120,000 units year-on-year to 497,000 units last year. 12% of vehicles sold in the global market are hybrid cars. "Last year's Genesis sales also increased 9.1% year-on-year," said Yoon Tae-sik, head of IR at Hyundai Motor.
Sports utility vehicles also sold well. In particular, the Palisade, a flagship SUV, recorded a 23% year-on-year increase in sales in the United States. Sales were 110,55 units, the highest ever. SUVs accounted for 56.1% of Hyundai Motor's global sales last year. Including Genesis GV60, GV70, and GV80, the proportion increases to 59.7%.
In addition, sales increased 4.2% in Latin America and 0.1% in India on a retail basis. On the other hand, Europe, China, and Russia decreased by 2.4%, 35.5%, and 12.0%, respectively.
However, the exchange rate effect was decisive in the decrease in operating profit despite such an increase in sales. In December last year, the won fell per dollar due to changes in domestic political conditions, which led to a significant increase in sales guarantee provisions, which led to an increase in costs. Sales and operating profit are calculated at the annual average exchange rate, while sales guarantee provision is applied at the end of the year. The average won per dollar in the fourth quarter of last year was about 1,396 won, but it fell to the late 1,400 won range in December.
Meanwhile, Hyundai defined 2025 as a period of uncertainty. Lee Seung-jo, vice president of Hyundai Motor's financial affairs division, said, "Uncertainty will expand in 2025 due to policy risks from the launch of a new U.S. government as well as strengthening European fuel efficiency regulations." According to Hyundai Motor's guidance, the annual wholesale sales target is 4.17 million units. This is a decrease of 70,000 units on a wholesale basis. This year's sales growth target is 3-4% and the operating profit ratio is 7-8%. This is also one percentage point lower than last year's goal.
Hyundai Motor said in a conference call that it is considering "re-bashing" the electric commercial vehicle sector with GM, a U.S. carmaker. Re-bashing refers to selling the same vehicle with different company logos.
According to Lee Seung-jo, vice president of the conference call, Hyundai Motor is cooperating with GM in three areas: purchase, commercial electricity and passenger electricity, and aims to sign a final contract and sign it within the first quarter of this year. Vice President Lee said, "We are promoting joint purchases by selecting items centering on the North American and Latin American markets," adding, "The two companies have decided to cooperate in the riding field and are working on selecting specific models." As the new U.S. administration of Donald Trump is expected to implement policies to support U.S. automakers, its rebasing strategy is expected to help maintain Hyundai Motor's current sales in the U.S. market.
Hyundai Motor has set the dividend for the end of 2024 at 6,000 won per share and the dividend base date is Feb. 28. This year's investment aims to respond to SDV (software-oriented vehicle) transition and establish a supply chain for electric vehicles in the U.S. R&D investment is 6.7 trillion won, facility investment is 8.6 trillion won, and strategic investment is 1.6 trillion won. The total investment of 16.9 trillion won is an increase of 15.7% compared to the investment performance in 2024. Meanwhile, according to the Korea Automobile Mobility Industry Association (KAMA), the domestic market for finished vehicles decreased by 6.5% year-on-year last year. In particular, sales of commercial vehicles such as freight cars fell 21.4% due to the economic slowdown. Hyundai Motor also said in its IR data that retail sales of finished cars in Korea fell 7.5% last year from a year earlier.
[Reporter Park Jewan]
