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The Korea Herald
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THE INVESTOR
March 29, 2024

Automobiles

Hyundai to reduce incentives in US on slowing sales

  • PUBLISHED :July 26, 2017 - 17:24
  • UPDATED :July 26, 2017 - 17:24
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[THE INVESTOR] Hyundai Motor, nation’s largest carmaker, on July 26 said it plans to reduce incentive spending and put all-out efforts to improve profitability in the US, in response to slowed sales in its second largest overseas market after China. 

“US sales dropped in the first half, due to weak sedan sales, as well as slowed growth in the SUV segment,” Hyundai CFO Choi Byeong-cheol said during a conference call after its second-quarter earnings report. “Due to heated competition, Hyundai’s incentive (spending) increased 32 percent on-year to an average of US$2,800 per vehicle in the first half.”




From January-June, Hyundai sold 346,000 units in the US, down 7.4 percent from a year earlier, despite increasing incentives to boost sales in the short term. 

The second half doesn’t look so bright, according to the carmaker, as its sedan-heavy lineup is losing ground in the popular SUV segment, fueled by low gasoline prices. 

“The slowed demand is expected to persist in the latter half,” Choi said. “We will put improving profitability as a priority, while reducing incentive spending.”

The carmaker said it will focus on increasing sales of Ioniq cars as well as the new Sonata that will soon hit the market. It is also eyeing to revive sales with its latest Kona subcompact SUV, which will be launched in the US in December. 

During the conference call, Hyundai said its second-quarter operating profit dropped 23.7 percent on-year to 1.34 trillion won (US$1.19 billion), hit by a sales slump in its all-important Chinese market amid political tension. 

Revenue came to 24.30 trillion won, down 1.5 percent from a year earlier, and net profit stood at 913.6 billion won in the April-June period, down 48.2 percent. The automaker sold 1.10 million units in the cited period. 

As for the first half of this year, Hyundai sold 2.19 million units in Korea and overseas, down 8.2 percent.

By Ahn Sung-mi (sahn@heraldcorp.com)

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